China Caucus Blog

Vietnam Has Moved New Rocket Launchers Into Disputed South China Sea. Greg Torode, Reuters. “Vietnam has discreetly fortified several of its islands in the disputed South China Sea with new mobile rocket launchers capable of striking China's runways and military installations across the vital trade route, according to Western officials. Diplomats and military officers told Reuters that intelligence shows Hanoi has shipped the launchers from the Vietnamese mainland into position on five bases in the Spratly islands in recent months, a move likely to raise tensions with Beijing. The launchers have been hidden from aerial surveillance and they have yet to be armed, but could be made operational with rocket artillery rounds within two or three days, according to the three sources. Vietnam's Foreign Ministry said the information was "inaccurate", without elaborating. Deputy Defence Minister, Senior Lieutenant-General Nguyen Chi Vinh, told Reuters in Singapore in June that Hanoi had no such launchers or weapons ready in the Spratlys but reserved the right to take any such measures. "It is within our legitimate right to self-defence to move any of our weapons to any area at any time within our sovereign territory," he said. The move is designed to counter China's build-up on its seven reclaimed islands in the Spratlys archipelago. Vietnam's military strategists fear the building runways, radars and other military installations on those holdings have left Vietnam's southern and island defences increasingly vulnerable. Military analysts say it is the most significant defensive move Vietnam has made on its holdings in the South China Sea in decades. Hanoi wanted to have the launchers in place as it expected tensions to rise in the wake of the landmark international court ruling against China in an arbitration case brought by the Philippines, foreign envoys said. The ruling last month, stridently rejected by Beijing, found no legal basis to China's sweeping historic claims to much of the South China Sea. Vietnam, China and Taiwan claim all of the Spratlys while the Philippines, Malaysia and Brunei claim some of the area. "China has indisputable sovereignty over the Spratly islands and nearby waters," China's Foreign Ministry said in a faxed statement on Wednesday. "China resolutely opposes the relevant country illegally occupying parts of China's Spratly islands and reefs and on these illegally occupied Spratly islands and reefs belonging to China carrying out illegal construction and military deployments." The United States is also monitoring developments closely. "We continue to call on all South China Sea claimants to avoid actions that raise tensions, take practical steps to build confidence, and intensify efforts to find peaceful, diplomatic solutions to disputes," a State Department official said. Foreign officials and military analysts believe the launchers form part of Vietnam's state-of-art EXTRA rocket artillery system recently acquired from Israel. EXTRA rounds are highly accurate up to a range of 150 km (93 miles), with different 150 kg (330 lb) warheads that can carry high explosives or bomblets to attack multiple targets simultaneously. Operated with targeting drones, they could strike both ships and land targets. That puts China's 3,000-metre runways and installations on Subi, Fiery Cross and Mischief Reef within range of many of Vietnam's tightly clustered holdings on 21 islands and reefs. While Vietnam has larger and longer range Russian coastal defence missiles, the EXTRA is considered highly mobile and effective against amphibious landings. It uses compact radars, so does not require a large operational footprint - also suitable for deployment on islets and reefs. "When Vietnam acquired the EXTRA system, it was always thought that it would be deployed on the Spratlys...it is the perfect weapon for that," said Siemon Wezeman, a senior arms researcher at the Stockholm International Peace Research Institute (SIPRI). There is no sign the launchers have been recently test fired or moved. China took its first Spratlys possessions after a sea battle against Vietnam's then weak navy in 1988. After the battle, Vietnam said 64 soldiers with little protection were killed as they tried to protect a flag on South Johnson reef - an incident still acutely felt in Hanoi. In recent years, Vietnam has significantly improved its naval capabilities as part of a broader military modernisation, including buying six advanced Kilo submarines from Russia. Carl Thayer, an expert on Vietnam's military at the Australian Defence Force Academy, said the deployment showed the seriousness of Vietnam's determination to militarily deter China as far as possible. Trevor Hollingsbee, a former naval intelligence analyst with the British defence ministry, said he believed the deployment also had a political factor, partly undermining the fear created by the prospect of large Chinese bases deep in maritime Southeast Asia. "It introduces a potential vulnerability where they was none before - it is a sudden new complication in an arena that China was dominating," he said.” http://www.reuters.com/article/us-southchinasea-vietnam-idUSKCN10K2NE

China Launches A Stealth Invasion In The South China Sea. David Axe, The Daily Beast. “On Aug. 6, the Chinese government sent a stealth invasion force sailing into the disputed waters surrounding traditionally Japanese-occupied islands in the East China Sea. But there wasn’t a single Chinese naval warship among the nearly 250 vessels that swarmed the Senkaku Islands, around 250 miles southwest of Japan. Instead, Beijing deployed 13 coast guard ships, some of them armed, along with an estimated 230 fishing vessels operated by government-sponsored maritime militiamen. China has sent ships into disputed waters before, but never on this scale. “The latest developments … do seem to be a potentially significant escalation,” Christopher Hughes, a professor of international politics at the University of Warwick in the United Kingdom, told The Japan Times. Beijing’s heavy reliance on civilian militia is equally noteworthy—and, for China’s rivals, potentially very worrying. These “little blue men,” as U.S. Naval War College associate professor Andrew Erickson has dubbed them, have become the main combatants in China’s undeclared—and so far mostly bloodless—pseudomilitary campaign of expansion into the East and South China Seas. Erickson’s nickname for China’s maritime militia references the so-called “little green men,” or incognito soldiers, that Moscow sent into Ukraine to back pro-Russian separatists. There are clear advantages to mobilizing civilian paramilitaries for what amounts to a military mission, Erickson said. In deploying government-controlled fishermen, Beijing gets “the bonus without the onus” as it tries to forcefully cement its claim to huge, fish- and mineral-rich swathes of the western Pacific. After all, if China sent heavily-armed warships into waters that another country claimed, the other claimant could respond in kind, deploying armed warships of its own and forcing a confrontation that, at the very least, would get the whole world’s undivided attention. But in sending fishermen, China both maintains credible deniability regarding its true intentions and has the opportunity to portray the other side as overly forceful—or indeed to turn the tables, and cast the defender as the attacker. The little blue men have popped up across the China Seas, in waters that China, Japan, Taiwan, The Philippines, Malaysia and Indonesia claim—as well as in the undisputed national waters of Indonesia and Malaysia. “Anyone seeing a pattern here?” Erickson quipped on Twitter. In 2014, Indonesia began seizing and blowing up intruding Chinese trawlers. And, after a fleet of nearly 100 Chinese trawlers invaded Malaysia’s exclusive economic zone the government there threatened to start sinking Chinese fishing boats it catches in its own waters. Malaysia and Indonesia are trying to head off Chinese campaigns of maritime expansion before they gain momentum and any degree of international legitimacy. In other regions, China has moved quickly to take advantage of the little blue men’s presence in disputed waters. In late 2014, Chinese dredging ships followed a fleet of little blue men to the Spratly Islands, just west of The Philippines. Beijing and Manila both claim the Spratlys, but that didn’t stop the Chinese government from piling sand atop several delicate reefs, creating artificial islands and, consequently, killing the reefs. Within a year, Beijing had built airfields, seaports, and military installations on seven new, artificial islands. Manila took Beijing to court, and in July of this year, an international tribunal rejected China’s claim to the South China Seas. But by then the deed was done. The Chinese military shrugged off, and even mocked, the tribunal’s verdict, and began flying bombers and fighter jets over the islands. And when the U.S. Navy destroyer USS Lassen sailed through international waters near the Spratlys in October, trawlers crewed by little blue men maneuvered dangerously close to the warship, even crossing in front of its bow, risking a collision. Twice in May and June, Chinese fighter planes intercepted U.S. military reconnaissance planes flying in international air space in the East and South China Seas. The Americans crews claimed the Chinese pilots flew dangerously close to the U.S. planes. When the Pentagon protested, the Chinese foreign ministry shot back. The Americans’ aerial reconnaissance “undermines China’s maritime security,” ministry spokesman Hong Lei said. In a foreboding message to the Chinese people in the aftermath of the tribunal’s ruling on China’s South China Seas claims, Chinese defense minister Chang Wanquan called for a “people’s war at sea” in order to preserve Chinese sovereignty. Japan is clearly worried that Beijing could move on the Senkakus, which the Chinese call the Diaoyus, the same way Beijing successfully occupied the Spratlys. The Senkakus are currently uninhabited but have, over the last couple of centuries, periodically hosted some small Japanese commercial enterprises. Japan formally reiterated its claim on the islands back in 2012. It certainly didn’t help calm Japanese officials’ nerves when, in early August, their forces detected a radar aboard a Chinese oil rig positioned near disputed waters in the East China Sea. Japanese media described the rig as a potential military base. A day after the mixed fleet of Chinese coast guard ships and little blue men swarmed the Senkakus, Japan’s vice minister of foreign affairs Shinsuke Sugiyama lodged a protest with Cheng Yonghua, China’s ambassador to Japan demanding that Chinese vessels depart the Senkakus. “China is conducting unilateral activities that further raise tensions on the ground,” the Japanese foreign ministry stated. Chinese incursions “cannot be accepted whatsoever,” the ministry added. But Japan has not yet sent its own ships to try dislodging the Chinese fleet. If the current invasion of little blue men represents an effort on China’s part to definitively seize the Senkakus, then so far, it could be working. Beijing perhaps underscored its intentions in the East China Sea with a nice bit of military propaganda. On Monday, Chinese censors let leak a clear photo of China’s first homemade aircraft carrier, currently under construction at a shipyard in northern China. Once complete, the carrier could be the most powerful non-American warship in the Pacific. The photo serves a reminder that China is growing in power and influence—and that it’s building a fleet to match its aspirations. But when Beijing wants to take over an island without starting a war, it doesn’t need a fleet of warships. The little blue men can do the job.” http://www.thedailybeast.com/articles/2016/08/09/china-launches-a-stealth-invasion-in-the-south-china-sea.html

New Photos Cast Doubt On China’s Vow Not To Militarize Disputed Islands. David E. Sanger and Rick Gladstone, The New York Times. “When President Xi Jinping of China visited President Obama at the White House last September, he startled many with reassuring words about his intentions for the Spratly Islands, a contested area where the Chinese government has been piling dredged sand and concrete atop reefs for the past few years and building housing and runways on them. “China does not intend to pursue militarization,” Mr. Xi said, referring to the area as the Nansha Islands, a Chinese name for what most of the rest of the world calls the Spratlys in the South China Sea. The most recent satellite photographs suggest a different plan. The photos, collected and scrutinized by the Center for Strategic and International Studies, a Washington-based research organization, show the construction of what appear to be reinforced aircraft hangars at Fiery Cross, Subi and Mischief Reefs, all part of the disputed territories. There were no military aircraft seen at the time the photos were taken. But a summary of the center’s analysis suggests that the hangars on all three islets have room for “any fighter-jet in the People’s Liberation Army Air Force.” A larger type of hangar on the islets can accommodate China’s H-6 bomber and H-6U refueling tanker, a Y-8 transport aircraft and a KJ200 Airborne Warning and Control System plane, the center said in its analysis. While China may assert that the structures are for civilian aircraft or other nonmilitary functions, the center says its satellite photos strongly suggest otherwise. Besides their size – the smallest hangars are 60 to 70 feet wide, more than enough to accommodate China’s largest fighter jets – all show signs of structural strengthening. “They are far thicker than you would build for any civilian purpose,” Gregory B. Poling, director of the center’s Asia Maritime Transparency Initiative, said on Monday in a telephone interview. “They’re reinforced to take a strike.” The largest hangars, 200 feet wide, are “more than enough for strategic bombers and refuelers,” Mr. Poling said. If those planes were deployed, they would greatly complicate China’s disputes with the Philippines and other nations, and add a level of military risk to the United States’s “freedom of navigation” patrols through the area. Even before the hangars appeared, it was clear to independent military analysts that China’s intention was to use the islands to flex military might in the area. “We knew from the day they started building those runways,” Mr. Poling said. For China to assert a more benign purpose, he said, would be “like saying you’re building a mansion, but only living on the first floor.” Evidence of the military hangars emerged a month after an international tribunal at The Hague sharply rebuked China over its behavior in the South China Sea, including its assertion of expansive sovereignty and construction of artificial islands. The tribunal’s ruling was a response to a landmark case brought by the Philippines, which called it an “overwhelming victory.” Infuriated, China said it would ignore the ruling. Some analysts cautioned that the hangars were not a response to the ruling and had likely been under construction for some time. “The foundations may have been laid months ago,” said M. Taylor Fravel, a political science professor at the Massachusetts Institute of Technology and a member of its Security Studies Program. Mr. Fravel said the hangars are not necessarily inconsistent with the Chinese president’s assertions. “China has given itself the option to use these reefs as military facilities, but has not decided yet to what degree it is going to use them,” he said. “It creates the option for a robust defense of those places or even a power projection.” http://www.nytimes.com/2016/08/09/world/asia/china-spratly-islands-south-china-sea.html

China, N. Korea Prompt Japanese Minister's Remarks On Nuclear Armament. The Dong-A Ilbo. “Japan's new Defense Minister Tomomi Inada created a stir in Japan and other Northeast Asian countries by noting in a press interview on Friday that there is no principle that stops Japan from possessing nuclear weapons. "Japan's constitution (that states Japan should not use violence but keep whatever is necessary for self-defense) does not specifically define a minimal amount of necessary weapons," she said while answering questions on whether Japan should have nuclear weapons in the press interview. Prime Minister Shinzo Abe quickly tried to straighten out her remark by saying, "There will never be nuclear weapons in Japan or plans to make them." However, the defense minister's utterance seems to partly reflect Japan's atmosphere. Japan can make nuclear weapons anytime if it wants since it is equipped with 47.8 tons of plutonium for electricity generation, which can make 6,000 nuclear bombs. Yet, as a victim of nuclear bombing, Japan has not spoken of making nuclear weapons for themselves. With U.S. Republican presidential candidate Donald Trump's statement claiming that Japan and Korea should now protect themselves on their own with nuclear armament, Japan's rightist politicians are raising their voice to convince everyone else to "consider nuclear armament." The rightist argument is becoming stronger in Japan, while China is simply sitting by and watching North Korea developing nuclear weapons and ballistic missiles that now can fly to Japan's exclusive economic zone. U.S. Vice President Joe Biden sent a warning to Chinese President Xi Jinping in June, saying that if China steps back from the North Korean nuclear issue, that gives Japan a good reason to arm itself with nuclear weapons. American political magazine Politico reported that among Korea, Japan, and Taiwan, Japan is the most serious about nuclear armament. Against this backdrop, Japan will more vigorously push forward with its pursuit of nuclear sovereignty two years later at the end of the 30-year-old U.S.-Japan cooperation on Nuclear Energy. "Let us increase our military power that equals nuclear armament," some Korean politicians proposed in the National Assembly on Thursday right after North Korea fired the Rodong missile. South Korea is not going to tolerate China's threats against the THAAD deployment decision while at the same time refusing to take an action against North Korea's missile launch. "Whether the Sino-Japanese War was an invasion is not a matter of fact but a matter of viewpoint," Japanese Defense Minister Inada noted. "You cannot simply say that it was an invasion." Japan claims that the war began in 1937 when Japan attacked China military for shooting at the Japanese military in Beijing, however that is false. Inada is an extreme rightist politician who makes such comments as "'comfort women' were legal" without hesitation. Her denial of Japan's invasion in the Sino-Japanese War is condemnable, but it is China's hegemonism that is giving Japan's far rightists opportunities to become stronger.” http://english.donga.com/List/3/03/26/709351/1

North Korea Escalating Campaign Against THAAD. Elizabeth Shim, UPI. “North Korea may be stepping up efforts to maximize conflict in South Korea over the deployment of a U.S. anti-missile defense system. A South Korean government ministry official who spoke to local news service News 1 on the condition of anonymity said Pyongyang issued guidelines to its embassies abroad to launch a campaign against THAAD deployment. The propaganda drive is to make the most of tensions between China and the United States, as well as between China and South Korea, the official reportedly said. North Korea's foreign ministry had instructed its envoys to depict the THAAD issue as a U.S. threat to regional security, a provocation that challenges the North Korean state and to "make the most of the situation," according to the source. The source also said Kim Jong Un ordered his subordinates to promote an image of U.S. military buildup on the peninsula that is dividing the region, with South Korea, the United States and Japan on one side and China and Russia on the other. But South Korean intelligence officials are denying other press reports of North Korean interference on South Korean online forums, Herald Business reported Monday. An unidentified media service had reported anti-THAAD comments online could be traced back to a North Korean IP address. Intelligence officials told Herald Business that the findings are inconclusive, and also said it's not confirmed whether North Korea instructed its embassies to promote anti-THAAD statements. But one official said, "there is a likelihood" North Korea is stepping up its anti-THAAD campaign. Opinion is divided in South Korea over the deployment of THAAD. On Monday, South Korean President Park Geun-hye criticized six opposition party lawmakers for visiting China, The New York Times reported. "When it comes to a national security issue where the lives of the people are at stake, there should be no difference between the ruling and opposition parties," Park said.” http://www.upi.com/Top_News/World-News/2016/08/08/Report-North-Korea-escalating-campaign-against-THAAD/8261470666641/

China The Regional Bully Punishes Defiance In Asia-Pacific. Peter Hartcher, The Sydney Morning Herald. “North Korea's Kim Jong-un, "a great person born of heaven", according to the national news service, pressed the button to launch the two ballistic missiles fired towards Japan on Wednesday. One exploded immediately, an instant failure. But the other flew about 1000 kilometres before falling into the waters of Japan's exclusive economic zone, about 250 kilometres from the Japanese coast, setting off outrage in Tokyo. This move tells us something about the third of the Kim dynasty rulers, but the event and its aftermath is more revealing about two of his key neighbours. The world has learnt important facts about the emerging character of North Korea's closest rival, South Korea, and that of his only ally, China. Kim told his party congress in May that the regime's nuclear weapons program had won the nation "dignity and national power" and would never be surrendered. His actions speak louder than words. He has quickened the pace of testing. Under Kim Jong-un, North Korea is conducting underground nuclear explosions at an accelerated rate and ballistic missile tests much more frequently than at any time in the country's history. Together, these tests suggest a concerted effort to put miniaturised nuclear bombs on the tips of missiles capable of striking Japan, South Korea, and the giant US Pacific base in Guam, among other targets. Kim now has enough crude nuclear and missile capability "so that it is tantamount to an effective deterrent" against any attack, says an expert on international relations, Kim Tae-hyung of Soongsil University. "Could they really deliver nuclear warheads?" poses Professor Kim. "Maybe, maybe not, but we cannot assume they can't", and that gives Pyongyang a nuclear deterrent. The West's effort of the last 25 years was all designed to prevent this. It has failed. Second, North Korea's hellbent efforts have had a profound effect in South Korea. For three years, South Korea had been intensifying a romance with its biggest trading partner, China. The US, Seoul's military ally, was much chagrined. South Korea's President Park Geun-hye had a remarkable six summits with her Chinese counterpart, Xi Jinping, in three years. Xi didn't hold a single meeting with his ally, North Korea's Kim Jong-un, in the same time. "The Korea-China relationship has become the best-ever national relationship in history," Xi declared last year, doubtless delighted to be bringing a US ally into China's sphere of influence. Strikingly, Park was the only leader of a US ally to go to Beijing for its big military parade last September. She sat in a place of honour on Tiananmen Gate with Xi, his wife and Russia's President Vladimir Putin. But when Park wanted to put her friendship with Xi to the test, she got a rude awakening. North Korea conducted its fourth nuclear test in January. Park, alarmed, picked up the phone to speak to Xi. She, no doubt, wanted his help to rein in the rogue Kim. But Xi didn't answer her call. Or call her back. Park got the message. When it came to the crunch, the realpolitik of China's alliance with North Korea, however pathetic that country may be, trumped its relationship with South Korea. It was a threshold moment for Park. She took an equally realpolitik position. First, she withdrew all remaining co-operation with Pyongyang and struck a hard stance. "She is now aiming at a complete change of North Korean regime – not just withdrawing its weapons, but regime change," says Professor Kim. "I don't think that's compatible with China's policy", of supporting Kim's regime, preserving North Korea as a buffer state between itself and a US ally. He's right. It's not compatible. Even though China eventually supported new UN Security Council sanctions against North Korea, Park had made up her mind that she could not depend on Beijing in a crisis. She turned to the US. In February, Park agreed to discuss installing a US missile shield system, the Terminal High Altitude Area Defence or THAAD, to defend South Korea against the missiles of the North. She has since committed South Korea to installing the system, effective in the second half of next year. China has reacted furiously. Its ambassador to Seoul said that the relationship between the two countries could be "destroyed in an instant" if it went ahead with THAAD. China's foreign affairs minister Wang Yi said that "we will not accept why they made a deployment exceeding the need". In other words, China demands to be the arbiter of South Korea's defence needs. In truth, China is worried that if South Korea has THAAD, it will make it immune not only to North Korean missiles but also to the coercive possibility of Chinese missiles. So when Kim fired his missiles last Wednesday, what did China do? Beijing not only failed to criticise his destabilising behaviour, it also intervened at an emergency meeting of the UN Security Council to prevent criticism of Kim for breaching a UN Security Council resolution. At the same time, Beijing last week started to punish South Korea for defying China. In staccato, planned appearances in China by South Korean actors and singers were abruptly cancelled. The share price of South Korean entertainment firms fell by 5 to 25 per cent on Friday in response. At the same time, planned mass company trips to South Korea for Chinese workers were cancelled, aimed at damaging the South Korean tourist sector. These are undeclared Chinese economic sanctions against South Korea for acting in its own defence. Unfortunately, this is just the latest piece in the emerging picture of China as the great neighbourhood bully. Beijing is hitting out at countries that defy it – the running tally of countries subject to Chinese bullying now includes the Philippines, Vietnam and Indonesia in the South China Sea, Japan in the East China Sea and South Korea on the Asian landmass. North Korea is a deeply troubling rogue state, but we already knew that. The new and disturbing source of regional bullying is a much bigger and more serious power – China. "This shows China's true face," a South Korean official told me on condition of anonymity. "If it can happen once it can happen again – Koreans will now think twice about future investment in China." This is an emerging pattern that is troubling every capital across the Asia-Pacific and beyond.” http://www.smh.com.au/comment/china-the-regional-bully-punishes-defiance-in-asiapacific-20160808-gqntu7.html

Taiwan's Future Submarine Program: A Deep Dive. Julia Bowie and Baldwin Mei, Project 2049. “The People's Republic of China (PRC) has embarked upon a military modernization program that is prompting increasing naval buildups in the Asia-Pacific region. Submarines are of particular interest. Like other defense establishments in the region, the Republic of China's (ROC, referred to as Taiwan) Navy has a long standing, legitimate requirement for a fleet of diesel electric submarines that could provide a credible and survivable deterrent against the Chinese People's Liberation Army (PLA). Thus strengthening Taiwan's strategic position in any potential cross-Strait political negotiations and in the region at large. Though U.S. support for Taiwan's submarine program has long been a contentious subject, recent developments in Taiwan's indigenous program could herald in a new wave of cooperation. On December 1st, 2015, the Project 2049 Institute hosted a conference titled " A Deep Dive: Taiwan's Future Submarine Program." One presentation highlighted the complex nature of Taiwan's submarine program and the reasons why an agreement between the U.S. and Taiwan has failed to move forward. In addition, a panel of experts discussed Taiwan's submarine program in relation to the PLA's force modernization and Taiwan's defense strategy, and identified key policy goals for U.S.-Taiwan relations. The panelists agreed that a Taiwan submarine program would play a key role in the defense of the island, thereby reducing the effectiveness of the PLA's coercion tactics. This would have an important strategic effect on regional security. Given Taiwan's important role in regional security dynamics and strategic positioning in the first island Chain, any use of force against Taiwan would alarm other countries and thus destabilize the Asia-Pacific. A Taiwan submarine program would support regional peace and stability by providing Taiwan with a credible deterrent, and help to achieve a more stable cross-Strait balance. With regards to U.S. support, the experts agreed that the U.S. has a role to play in Taiwan's submarine program and that the U.S. should work to support the design and building of submarines in Taiwan. There are many ways the U.S. can become involved in a "low key" fashion-- through technical assistance, engineering, and technology transfer. As a first step, the U.S. government should license the domestic defense industry to contribute to the submarine program through program management, technical assistance, and direct commercial sales of submarine systems and components. Taiwan's Ministry of National Defense (MND) has identified submarines as a priority for territorial defense, and has sought to acquire a fleet of 8-12 diesel electric submarines since 1969. Under the Taiwan Relations Act (TRA) of 1979, the U.S. is committed to provide Taiwan with necessary defense articles and services. Based upon the initial findings of two U.S. assessment teams sent to Taiwan to evaluate its naval modernization requirements, the Bush administration agreed to assist Taiwan in its acquisition of submarines in 2001. However, complications have hampered the program until today, prompting Taiwan to invest and build its indigenous submarine program. The ROC Navy currently possesses four submarines, however two out of four of those vessels are outdated and cannot meet the requirements of modern warfare. Though recent life extension programs (LEP) were awarded in April 2016, the LEP's do not address operational requirements nor does it account for future combat environmental factors. Given the fact that most other regional maritime powers have expanded their submarine fleets, a new Taiwan submarine program is necessary to ensure Taiwan's undersea warfare capabilities. In addition to aiding Taiwan's defense capabilities, the submarine program would also have an impact on Taiwan's long-term peacetime competition with the PRC. Competitive strategies seek to induce a country's competitor to devote more resources to capabilities that the country views as unthreatening. A new Taiwan submarine program may stoke longstanding PRC fears of an island chain blockade, inducing China to devote greater resources to anti-submarine warfare (ASW). This may be beneficial, as strong ASW capability is difficult and expensive to develop, and is an area of long-running PLA organizational and technological weakness. Over the years, complications on both sides have delayed progress for the U.S. and Taiwan to cooperate on the submarine program:

• Political considerations and U.S.-China relations: Even though the submarine programs of many other countries are considered defensive, in the past, the U.S. avoided selling submarines to Taiwan or cooperating with Taiwan on its submarine program because it considered Taiwan's submarines offensive. Since then, pursuing a stable and constructive relationship with the PRC, which vehemently opposes arms sales and defense cooperation between the U.S. and Taiwan, has affected U.S. commitment to Taiwan. Increased prioritization of the U.S.-China relationship limits the flexibility with which the U.S. can cooperate with Taiwan.

• Domestic debates on Taiwan: Initially there was debate on Taiwan about whether to pursue a submarine sale through foreign military sales (FMS) channels or defense commercial sales (DCS). An FMS requires the U.S. Department of Defense (DOD)to work through the American Institute in Taiwan (AIT) to contract with U.S. defense industrial companies and the Taiwanese defense ministry, whereas, a DCS, requires the two defense departments to work together directly. This debate long stalled progress on the program. Furthermore, there were significant Taiwanese domestic interest groups that wanted Taiwan's domestic defense industry to undertake construction of the submarines. Eventually, with consensus between KMT and DPP, Taiwan declared an indigenous submarine program in 2014.

• Perceived cost effectiveness (in U.S.): The disparity in defense investments across the Strait has led to the consideration of the opportunity cost of the submarine program within the United States. Since Taiwan's military expenditure is low, a number of U.S. analysts have suggested that the funds for Taiwan's submarine program could be best allocated to improving other defense capabilities. Within Taiwan, however, there is no debate about whether or not a submarine program is necessary, but rather how the submarine program should be pursued.

• U.S. operational considerations: The U.S. is concerned about the water space management issues that could arise by having more Taiwanese submarines in the region. However, the U.S. has resolved those concerns with other countries and could do so with Taiwan as well.

In 2016, progress has been made in Taiwan's submarine program, with a $12.35 million LEP approved for Taiwan's two Hai Lung (Zwaardvis) class submarines. Designed to keep the units operationally effective for an additional 15 years, the LEP will likely include hull, mechanical and electrical upgrades, updates to the electronic support measures and combat systems, and replacement of legacy technologies with more modern alternatives for sustainability. The contract was awarded to two unnamed European companies, with the Ship and Ocean Industries Research and Development Center also serving a major role in the project. Due to Taiwan's lack of prior submarine building expertise, it is expected that European or American technical assistance will be brought in to aid the program. This can be seen as a prelude to Taiwan's indigenous development efforts, providing Taiwan's R&D personnel to get firsthand experience with key submarine systems before developing their own. In addition to the LEP, Taiwan has also begun the design process for its own indigenous submarine. Vice Admiral Mei Chia-Shu stated that the design process is expected to be finished by 2019 and the first submarine constructed by 2024, with a total program budget of $3 billion NT ($93.5 million). According to a report received by Kyodo News, the presumptive construction company CSBC Corp Taiwan will need significant foreign assistance during the construction process in key areas such as the turbine, motor, combat, and hull systems. This claim is reinforced by similar comments made by Admiral Pu Tze-Chun and CSBC's recent establishment of a submarine development center to support the submarine program. However, significant outside political and economic pressure (primarily from the PRC) is stalling the search for potential foreign aid. Taiwan has a legitimate, long-standing requirement for a modern fleet of diesel electric submarines. With the first stages of the indigenous submarine program underway, experts agree that the time is ripe for the U.S. to provide assistance to this groundbreaking program. Additionally, the TRA requires the U.S. to provide Taiwan with military articles and services based on military judgments alone rather than political considerations. Therefore, the U.S. should not allow Beijing to co-manage how it relates to Taiwan in terms of their defense needs. As such, the U.S. should offer fair considerations to export licenses and technical assistance with regards to Taiwan's indigenous submarine program and grant the necessary export licenses based on well defined criteria rather than other, intangible factors.” http://blog.project2049.net/2016/08/taiwans-future-submarine-program-deep_8.html?utm_source=Taiwan%27s+Future+Submarine+Program%3A+A+Deep+Dive&utm_campaign=Taiwan%C3%A2%C2%80%C2%99s+Future+Submarine+Program%3A+A+Deep+Dive&utm_medium=email

What The End Of The U.S. Arms Embargo Means For Vietnam. Cuong T. Nguyen, East Asia Forum. “The United States’ complete lifting of the decade-long embargo on arms sales to Vietnam marked a historic milestone in U.S. – Vietnam relations, paving the way for a strategic partnership between the two former foes. So what will this mean for Vietnamese security and domestic politics? The removal of the embargo will not immediately lead to large Vietnamese procurements of weapons platforms or systems. Rather, Vietnam will focus on procuring surveillance and reconnaissance technology related to maritime security, sophisticated communications systems and intelligence. The key challenge for Vietnam is whether it can afford these technologies. Human rights activists maintain that the policy is a miscalculated effort by the United States to enhance human rights protections in Vietnam. Although ideological differences have been an impediment to the advancement of U.S. – Vietnam relations, the removal of the arms ban has been driven by the superpower’s strategic interests. To help dispel fears among Vietnam’s conservative elite that growing bilateral relations are designed to bring about regime change, the United States has been conscious not to let human rights issues appear to be the price for the removal of the ban. The Trans-Pacific Partnership (TPP) agreement is a more effective channel to influence the structural and institutional features of Vietnam’s human rights regime, especially in the realm of labour rights. In addition to Chapter 19 of the TPP, the United States has concluded another bilateral agreement – the Consistency Plan for the Enhancement of Trade and Labor Relations – which requires Vietnam to implement specific legislative and regulatory reforms as a precondition for securing trade benefits with the United States. The plan includes a provision requiring Vietnam to authorise the formation of independent unions. If Vietnam fails to comply with this provision within five years after the agreement comes into force, the United States will withhold or suspend its ongoing tariff reductions. As Vietnam’s economic recovery is heavily reliant on its access to the U.S. market amid an ongoing slowdown in growth, this could allow the United States to win substantial human rights concessions from the ruling Communist Party of Vietnam (CPV). Some Chinese critics argue that the decision to lift the embargo will inflame the prevailing antagonism of the two countries against China. Both Vietnam and the United States recognise that any significant progress in the normalisation of ties will inevitably infuriate Beijing. But both countries do not want the ‘China factor’ to hinder the development of their bilateral relations. From Hanoi’s perspective, Vietnam does not want to get deeply involved in the U.S. – China power struggle. Vietnam wants to avoid either of two extreme scenarios: one in which the United States and China engage in direct military confrontation, which would be detrimental to Vietnam’s national interests; and the other in which the two powers compromise at the expense of other small countries in the region. The best way to avoid these scenarios is to take advantage of the United States or China to strengthen its self-help (military power) in an anarchic international order. Accepting the current position will send a clear message that Hanoi is not a pro-China government, thereby minimising the likelihood that the United States may compromise with China at the expense of Vietnam’s interests. The lifting of the embargo gives Hanoi more leeway to boost its defence capabilities without deviating from its long-standing national defence policy based on the ‘Three Nos’ principle: no military alliance with any country, no allowance for any country to establish military bases on its territory, and no reliance on military support from any country when fighting other countries. Vietnam aims to upgrade its national defence to protect its territorial sovereignty and become a responsible ASEAN member on regional security, rather than to constrain China’s rise. The removal of the embargo also serves to facilitate the CPV’s strategy of diversifying sources of military equipment and weapons, and reducing Vietnam’s reliance on Russian arms supply. In March this year an international port facility at Cam Ranh Bay was inaugurated that is capable of receiving foreign aircraft carriers and submarines that seek maintenance, repair and refuelling services. Prior to the opening ceremony, Vietnam and Japan reached an agreement permitting Japanese vessels to make port calls. For the United States, lifting the arms ban creates a new opportunity for its navy warships to make port calls or even secure access to Cam Ranh Bay as a quid pro quo. Although the United States has declared that it has no intentions to use the sea port at the moment, if they wish to counterbalance China on the South China Sea, Cam Ranh Bay’s strategic position will provide natural defence against attacks and abundant resources to refuel and repair U.S. fleets. In the long run, Vietnam will be integrated into a regional hub-and-spoke defence network that includes U.S. allies and its strategic partners. This special regional club will allow the U.S. to serve a much broader objective: institutionalising multilateral defence activities that would advance training possibilities and foster commitment to collaborative engagement in the Asia Pacific.” http://www.eastasiaforum.org/2016/08/09/what-the-end-of-the-us-arms-embargo-means-for-vietnam/

The Caucus Brief is a daily publication for Members of Congress and Hill Staffers on China news and information compiled by the office of Congressman Randy Forbes, Founder of the Congressional China Caucus. Email alex.gray@mail.house.gov with tips, comments, or to subscribe/unsubscribe.

Japan Pings Beijing Over Radar In East China Sea. Peter Landers and Jeremy Page, The Wall Street Journal. “Japan said Sunday it has issued multiple protests to China over actions in the East China Sea, including what Tokyo described as the installation of radar on a Chinese offshore gas platform. The Japanese foreign ministry also said that on Sunday, two Chinese coast-guard ships entered the territorial waters of islets in the East China Sea that are held by Japan and claimed by China, following incursions Saturday into a contiguous zone surrounding the territorial waters. The actions raised tensions in a long-running dispute between Tokyo and Beijing over the islets, known as the Senkakus in Japanese and Diaoyu in Chinese. Beijing is already at odds with the international community over a separate territorial dispute in the South China Sea after an international tribunal ruled in July that China’s claims there had no legal basis. In international waters of the East China Sea, China has 16 gas drilling platforms, and on one of them an ocean-radar facility and surveillance cameras were discovered in June, Japan’s foreign ministry said. A foreign-ministry spokesman said Japan “cannot accept” the radar. “We call for the immediate removal of the equipment,” he said. China’s foreign and defense ministries did not respond to requests for comment about the radar. Tokyo also lodged a protest Friday to China’s foreign ministry, via the Japanese Embassy in Beijing, the spokesman said. Tokyo has previously protested against what it calls China’s unilateral development of resources in the area. The installation of radar on a gas platform, if confirmed, would recall China’s actions in the South China Sea, where it has added military facilities on artificial islands. In 2013, China established an air-defense zone in the East China Sea, raising tensions with the U.S. and Japan. The recent incursions by Chinese ships around the disputed islets led Japan’s vice-minister for foreign affairs, Shinsuke Sugiyama, to issue a protest Sunday. “This series of actions by the Chinese side is a one-sided escalation that significantly raises tensions at the scene, and we absolutely cannot accept it,” Mr. Sugiyama told China’s ambassador in Tokyo, according to a Japanese foreign ministry statement. China has said that the islets are part of its territory and that its actions follow international law. In response to Japan’s protest about the Chinese vessels, China’s foreign ministry spokeswoman Hua Chunying on Saturday repeated Beijing’s position. “We strongly hope that the Japanese side will honor its principled agreement with us, [and] deal with the current situation with a cool head instead of taking actions that may raise tension or make things complicated,” she said in a statement on the foreign-ministry website.” http://www.wsj.com/articles/japan-pings-beijing-over-radar-in-east-china-sea-1470570816

China's Air Force Flies Combat Patrol Over Disputed Islands. Associated Press. “China's air force said Saturday that it has conducted a combat air patrol over disputed areas of the South China Sea to improve its fighting ability. The announcement comes after Beijing said it wanted to tamp down tensions following its strong rejection of an international tribunal that ruled that its claim to virtually all of the South China Sea has no legal basis. China refused to take part in the case taken by the Philippines to the Hague-based Permanent Court of Arbitration and continues to assert that islands in the South China Sea are its territory. The air force didn't say when the exercises took place. Last month, after the July 12 ruling, the air force said that it had conducted patrols over the South China Sea and would make it "a regular practice." Air force spokesman Senior Col. Shen Jinke said in an online statement that the patrol was "to enhance combat capabilities to deal with various security threats" and to safeguard the country's sovereignty and maritime rights and interests. Shen said bomber and fighter aircraft, early warning aircraft, reconnaissance planes and planes that can refuel in flight patrolled the airspace around the Spratly Islands, Scarborough Shoal and surrounding areas. The Spratlys and Scarborough Shoal are claimed by both China and the Philippines. Brunei, Malaysia, Taiwan and Vietnam also claim the Spratlys. Last week, Chinese Foreign Minister Wang Yi said the U.S., Japan and Australia were "fanning the flames" of regional tensions after they released a joint statement urging China not to construct military outposts or reclaim land in disputed waters. On Wednesday, Foreign Ministry spokeswoman Hua Chunying said that "China stands ready to continue its efforts to peacefully resolve relevant disputes in the South China Sea." http://bigstory.ap.org/article/4761dde1297741b2bc803e0a0f9f55e6/chinas-air-force-flies-combat-patrol-over-disputed-islands

Five Lethal Chinese Weapons Of War (Stolen Or Copied From Russia And America.) Robert Farley, The National Interest. As the People’s Republic of China (PRC) emerged from war and revolution in 1949, it became apparent that the Chinese economy lacked the capacity to compete with the U.S. or the U.S.S.R. in the production of advanced military technology. Transfers from the Soviet Union helped remedy the gap in the 1950s, as did transfers from the United States and Europe in the 1970s and 1980s. Still,the Cultural Revolution stifled technology and scientific research, leaving the Chinese even farther behind. Thus, China has long supplemented legitimate transfers and domestic innovation with industrial espionage. In short, the PRC has a well-established habit of pilfering weapons technology from Russia and the United States. As the years have gone by, Beijing’s spies have become ever more skillful and flexible in their approach. Here are five systems that the Chinese have stolen or copied, in whole or in part: J-7: In 1961, as tensions between the USSR and the PRC reached a fever pitch, the Soviets transferred blueprints and materials associated with its new MiG-21 interceptor to China. The offering represented an effort to bridge part of the gap, and suggest to China that cooperation between the Communist giants remained possible. The offering didn’t work. Sino-Soviet tensions continued to increase, nearly to the point of war in the late 1960s. The Chinese worked from the blueprints and other materials, and eventually produced the J-7, a virtual copy of the MiG-21. The Chinese eventually sold the J-7 (F-7 export variant) in direct competition with the MiGs sold by the Soviets. Indeed, after the US-PRC rapprochement of the early 1970s, the Chinese sold J-7s directly to the Americans, who used them as part of an aggressor squadron to train US pilots to fight the Soviets. J-11: The collapse of the Soviet Union in the early 1990s heralded a thaw in Russia-China relations. Russia no longer had strong reasons to withhold its most advanced military technology from the Chinese. More importantly, the huge Soviet military industrial complex needed customers badly, and the Russian military could no longer afford new equipment. For its part, the PRC needed new sources of high technology military equipment after Europe and the United States imposed arms embargoes in the wake of the Tiananmen Square massacre. Accordingly, the 1990s saw several huge arms deals between Moscow and Beijing. One of the most important involved the sale, licensing, and technology transfer of the Su-27 “Flanker” multirole fighter. The deal gave the Chinese one of the world’s most dangerous air superiority fighters, and gave the Russian aviation industry a lifeline. But the era of good feelings couldn’t hold. Details remain murky and disputed, but the Russians claim that the Chinese began violating licensing terms almost immediately, by installing their own avionics on Flankers (J-11, under Chinese designation). The Chinese also began developing a carrier variant, in direct violation of agreed-to terms. The appropriation of Russian technology undercut the relationship between Russia and China, making the Russians far more wary of transferring their crown jewels to the Chinese military. J-31: Even before the Snowden leaks established extensive Chinese industrial espionage, Americans analysts suspected that China was stealing information associated with the F-35. The likely reality of this theft became clear when information about the J-31 stealth fighter became available. The J-31 looks very much like a twin-engine F-35, without the VSTOL capabilities of the F-35B. The J-31 also presumably lacks much of the advanced avionics that have the potential to make the F-35 a devastating fighter. Nevertheless, the J-31 may eventually operate from carriers, and could potentially compete with the Joint Strike Fighter on the export market. UAVs: In 2010, China lagged woefully behind the United States in unmanned aerial vehicle (UAV) technology. Since that time, the Chinese have caught up, and are now producing drones capable of competing with US models on the international arms market. How did the Chinese catch up so fast? According to US intelligence, Chinese hackers appropriated technology from several sources, including the US government and private companies (General Atomics) associated with the production of UAVs. The newest Chinese UAVs closely resemble US aircraft visually and in performance, a remarkable turn-around time for China’s aviation industry. Night Vision Technology: After the Vietnam War, the United States military decided that it would invest heavily in an effort to “own the night.” This led to major advances in night vision technology, including equipment that allowed individual soldiers, armored vehicles, and aircraft to see and fight in the dark. This equipment has given the US a huge advantage in several conflicts since the 1980s. China is seeking to end this advantage, and has geared some of its espionage efforts towards acquiring and replicating US tech in this area. This has included some cyber-theft, but also several old-style ops in which Chinese businessmen illegally acquired export-controlled tech from US companies. The Last Salvo: The United States has become increasingly aggressive about slowing down or halting China’s industrial espionage efforts. This has included indictments of PLA officers, broad condemnations of Chinese spying, and targeted reprisals against some Chinese firms. But given the extensive commercial contacts between China and the United States, stopping the flow of technology is virtually impossible. Moreover, China has developed a large, innovative technology economy in its own right. Indeed, as Chinese technology catches up with American (and in some cases exceeds Russian) we may see the Chinese run into the same problems with foreign espionage.” http://nationalinterest.org/blog/the-buzz/5-lethal-china-weapons-war-stolen-or-copied-russia-america-17275?utm_source=Sailthru&utm_medium=email&utm_campaign=Defense%20EBB%2008-08-16&utm_term=Editorial%20-%20Early%20Bird%20Brief

China Mulls Ramping Up Its Missile Defense With Russia. Staff, Space Daily. “With the televised demonstration of China's latest system of intercepting incoming ballistic missiles during the intermediate stage of their flight, it looks like the People's Republic is poised to become the second country after the US to deploy a missile shield. In an interview with Sputnik, Vasily Kashin, a Moscow-based military expert, said that in their effort to develop what may be dubbed HQ-19, the Chinese may possibly be working closely with Russia, whose S-500 Prometey missile defense system, now under development, and the strategic missile system A-235 Nudol, which is currently undergoing trials, will be able to shoot down incoming warheads even before they enter the atmosphere. The long-range A-235 missile will have a range of up to 1,500 km and will be able to carry a nuclear warhead which will dramatically improve its ability to shoot down enemy warheads. "What really matters here is just how many such missile defense systems China will be able to deploy and who they are going to be used against. The modern US ballistic missiles are either land or sea-based intercontinental ones the ATACMS short-range Chinese missiles will hardly be able to deal with," Kashin said. As for Japan, Kashin said that even though it has no ballistic missiles of its own, Tokyo, with its advanced space program, could have no problem developing such missiles. Taiwan shuttered its ballistic missile programs back in the 1990s, relying instead on cruise missiles. South Korea's Hyunmoo ballistic missiles have limited range and pose no real threat to China. "The deployment of a limited missile defense system will give the Chinese an edge over regional powers, like Iran, Pakistan, India and North Korea, capable of building medium-range missiles and eventually relatively primitive types of ICBMs. And it will also come as a potent means of containing the imaginary missile threat by India," Kashin added. With the new system in place, China will also be able to shoot down US spy satellites. Vasily Kashin said that even though the publicized tests of China's new missiles defense system were apparently meant as Beijing's answer to the deployment of US THAAD missiles in South Korea, it would hardly be able to effectively counteract the American missile shield, primarily due to the obvious US edge in the number of nuclear warheads. "China's most probable answer to the emergence of THAAD in South Korea could be the deployment of its newly developed cruise missiles to destroy the Americans' THAAD system during the initial stage of an armed conflict," Vasily Kashin said in conclusion. The United States and South Korea announced plans in July to deploy a Terminal High Altitude Area Defense (THAAD) anti-missile system, ostensibly to counter threats from North Korea, but the move received immediate condemnation from Russia and China, who view the installation as a veiled attempt by Washington to undermine Beijing and Moscow's mutual nuclear deterrent. Moscow immediately joined Beijing in warning the United States that the deployment would have "irreparable consequences." http://www.spacedaily.com/reports/China_Mulls_Ramping_Up_Its_Missile_Defense_With_Russia_999.html

Chinese Men Taking On Dead Thais' Identities To Open Businesses In Thailand. Editorial Board, Thai Visa News. “Following the arrest of two men on Tuesday – one who is Chinese and one who arranged for him to take on a false identity – a tour company was raided in the Rama 9 area of Bangkok yesterday, reported tnamcot. The Xinyuan Travel Company was an agency opened by Somkiat Khongcharoen. Somkiat is in fact a Chinese man who took on a dead man’s name. This, police say, was arranged by another man arrested Tuesday called Thawan Jemchokchai. Police say that Thawan has a long history of this crime helping to set up Chinese men with lives and businesses in Thailand. Around 50 soldiers, customs officers and police from the Makkasan station took part in yesterday’s raid on the travel agency in which a large amount of evidence was seized.” http://news.thaivisa.com/thailand/chinese-men-taking-on-dead-thais-identities-to-open-businesses-in-thailand/150426/

Australian Farmer Causes Storm In South China Sea Territorial Dispute. Bill Brown, ABC South East NSW. “When he is not on his farm in the high country of south-east New South Wales, Hans Berekoven is an amateur marine archaeologist recovering artefacts from a shipwreck for a Malaysian museum. He said during one trip, he had been harassed by a Chinese Coast Guard vessel that had been stationed off Luconia Shoals for the past few years. The shoals are a cluster of reefs and a tiny island called the Luconia Breakers, 84 nautical miles off Malaysia's Borneo coast. "They were trying to push us out. When we arrived there and started diving, they would up-anchor and sort of circle around us, sometimes really close. It was a sort of gentle intimidation," Mr Berekoven said. China, Taiwan, the Philippines, Indonesia, Malaysia and Brunei all have competing claims over the South China Sea. The dispute has been a major flashpoint in the region, with accusations of China building artificial islands and damaging reef systems. An international tribunal recently ruled China had violated the Philippines' economic and sovereign rights as defined by the United Nations Law of the Sea Convention. Since 1947, China has claimed a vast area of islands in the South China Sea, including the Luconia Shoals. Professor Clive Schofield, an authority on marine jurisdictional issues, said that at 84 nautical miles from the Borneo coast, the Luconia Shoals were clearly on Malaysia's continental shelf, and well within Malaysia's 200 nautical mile exclusive economic zone (EEZ), as defined by the Law of the Sea Convention. "So if there's any jurisdiction and rights over the feature [the Luconia Shoals], then they are Malaysian and not Chinese," Professor Schofield said. Mr Berekoven said he was angered by damage he alleged was being caused by the China Coast Guard vessel anchoring on the reef. "She's got a massive anchor chain. Every time the wind changes or the current changes that big anchor chain is just making a hell of a mess of that reef," he said. Mr Berekoven chose Malaysia's independence day to protest the situation by raising the Malaysian flag on the tiny island. "I took the curator of the museum that we're working with, and a couple of other Malaysian friends, and a journalist from the Borneo Post," he said. They mounted a stainless steel flagpole into a cement footing and raised the Malaysian flag, as the China Coast Guard vessel watched from about 500m offshore. 'They must have got on the blower to Beijing and Beijing must have got on the blower to Kuala Lumpur, because suddenly there was a big kerfuffle in KL," Mr Berekoven said. The next morning, a Malaysian aircraft flew low over Mr Berekoven's boat and the island. "A Malaysian coast guard vessel was despatched. Went out there and unbolted the flag," he said. Professor Schofield said he was not surprised at Malaysia's action, because Malaysia had traditionally dealt with issues by taking a quiet diplomatic route with China and avoiding public conflict. He said tensions in the South China Sea focused on the wealth of oil and gas resources in the region, and freedom of navigation in the busy maritime trade routes. "However, the importance of the fisheries is often overlooked," Professor Schofield said. "The South China Sea has been estimated to provide around 12 per cent of global fisheries catch. "It provides fisheries which are vital to food security within the region, where potentially hundreds of millions of people have their primary protein requirements met by the fish from these waters." Professor Schofield said a rare exception to Malaysia's quiet diplomacy with China occurred earlier this year when about 100 Chinese fishing boats arrived at the Luconia Shoals. "For Malaysia there was a relatively strong reaction calling in the Chinese ambassador to protest against that," he said. Malaysia's national security minister Shahidan Kassim was reported by the Bernama news agency as announcing the despatch of assets from the Malaysian Maritime Enforcement Agency, and that the navy had been sent to the area near the Luconia Shoals to monitor the situation. Professor Schofield said such an action underlined the importance of the fishery to Malaysia. He said fisheries in the region were over-fished and under extreme stress with fish stocks declining. Mr Berekoven is preparing to return to Luconia Shoals to resume recovering artefacts from the nearby shipwreck.” http://www.abc.net.au/news/2016-08-08/malaysian-flag-rasing-causes-south-china-sea-incident/7679024

Hong Kong’s Pledge Of Allegiance. Editorial Board, The Wall Street Journal. “Hong Kong will elect its Legislative Council on Sept. 4, and Beijing is alarmed that among the candidates are young activists with a more confrontational policy toward the mainland. Its solution is to require candidates to sign a loyalty pledge affirming that Hong Kong is an “inalienable” part of China before they can register to run. In the past week, election officers have disqualified six candidates for refusing to sign the pledge or, in the case of student activist Edward Leung, for signing it unconvincingly. The 25-year-old Mr. Leung, who ran in a by-election this year and earned 15% of the vote, promised to mute his past support for independence. But officials barred him anyway, citing Facebook posts and media statements as proof he hadn’t “genuinely changed” his stance. Thirty leading lawyers, including past chairs of the Bar Association, blasted the government in a statement this week. Under Hong Kong law, they wrote, officials don’t have “any power to inquire into the so-called genuineness of the candidates’ declarations, let alone making a subjective and political decision to disqualify a candidate without following any due process on the purported ground that the candidate will not genuinely uphold the Basic Law.” The candidate bans, they added, “are not only unlawful but amount to political censorship and screening.” As recently as the 75-day pro-democracy demonstrations of 2014, advocating independence for Hong Kong was a fringe position. But the government’s uncompromising response to those protests—and its eagerness to paint critics as radical subversives—made the cause more credible, especially among the young. Disqualifying pro-independence candidates could give the movement a further boost. Weeks after the protests ended last year, Hong Kong’s pro-Beijing chief executive, Leung Chun-ying, used his annual policy address to slam an obscure Hong Kong University journal that wrote about “Hong Kong nationalism.” Copies of the journal quickly sold out and a survey of some 570 students found 28% backing independence, twice as many as the year before. A different, citywide survey this summer asked about independence for the first time and found 17% in favor, though only 4% think the goal is realistic. Such numbers will rise if the purge of pro-independence candidates escalates into a mainland-style crackdown on “splittism.” The disqualified candidates are heading to court, where they’ll have a strong case that election officials have acted lawlessly.” http://www.wsj.com/articles/hong-kongs-pledge-of-allegiance-1470335490

A Pacific Admiral Takes China’s Measure. David Feith, The Wall Street Journal. “Beijing has a consistent explanation for the rising tensions in the South China Sea: It’s America’s fault. As Chinese leaders tell it, their country is the victim of a U.S. bullying campaign designed to keep China down by uniting Asian states against it. For proof they cite episodes such as the recent United Nations arbitration case filed by the Philippines and cheered by the U.S., Japan, Vietnam and others, which ended last month in a rebuke of China’s aggressive maritime claims and practices, including building artificial islands in international waters and harassing foreign ships. An arch villain in China’s narrative is Adm. Harry Harris, the commander of U.S. military forces in the Pacific, who last year had the gumption to warn that Beijing is building a “Great Wall of Sand” in the South China Sea. The four-star former reconnaissance flight officer also happens to be the son of an American father and a Japanese mother, a fact oft-noted by Chinese state media as proof of malign intent. “To understand the American’s sudden upgraded offensive in the South China Sea,” Xinhua has said, “it is simply impossible to ignore Admiral Harris’s blood, background, political inclination and values.” Such racial innuendo is merely one illustration of China’s harsh anti-American propaganda. But in his first interview since last month’s landmark U.N. arbitration verdict, the 60-year-old admiral is consistently conciliatory, taking no victory lap and finding the bright side of several trouble spots. As the Obama era winds down, top U.S. leaders are still holding out hope that China will mellow as it rises and integrate peacefully into the global order. “I don’t want to talk in terms of winners and losers because that’s not helpful,” Adm. Harris says of the U.N. ruling as he visits Tokyo to meet defense officials and Prime Minister Shinzo Abe. He allows that the verdict “was sweeping in its nature” and helpfully “eliminated some of the ambiguities” concerning China’s sea claims and artificial islands, but he stresses that “the United States is not a party to the ruling.” “We’re at the point where it’s up to China and the Philippines to start talking about it,” he says, citing Secretary of State John Kerry, “then we’ll see where it goes.” And what can the U.S. and its partners do to back the verdict, seeing as the U.N. tribunal has no enforcement power of its own? “I don’t think we have as a mission enforcing tribunal rulings,” Adm. Harris says, “but we can show support for the rulings” rhetorically and by exercising freedom of navigation: “the idea of flying, sailing and operating everywhere international law allows.” This formulation has been a mantra of U.S. officials for more than a year, even as the U.S. Navy has conducted only three freedom-of-navigation operations (Fonops) through Chinese-claimed waters, all under the ambiguous minimalist doctrine of “innocent passage.” Adm. Harris has pushed his bosses for clearer and more frequent Fonops, according to the Navy Times and other outlets, but so far has been rebuffed. If Adm. Harris fears the U.S. and its friends have lost the post-tribunal initiative by failing to carry out new Fonops, he isn’t saying. But concerns are mounting among Asian officials and South China Sea watchers who note that the 10-member Association of Southeast Asian Nations failed even to mention the verdict in a recent joint communique, while the new government of Rodrigo Duterte in the Philippines has played it down. Could this muted response embolden China to escalate, perhaps by trying to build an artificial island at Scarborough Shoal? Building atop Scarborough, which China seized from the Philippines in a Putinesque move in 2012, would give Beijing a foothold 120 miles off the strategic Philippine port of Subic Bay and near the Luzon Strait, a key gateway to the open Pacific. China appeared poised to start construction there in March but backed off as President Obama and other U.S. officials issued private warnings to Beijing and Adm. Harris’s Pacific Command moved additional assets to the area, including A-10 ground-attack aircraft. Now Adm. Harris reports that since the tribunal verdict “there hasn’t been any demonstrable change in Chinese behavior around [Scarborough] in terms of dredging or any of that activity. So I think we’re at a place where truly we have to wait and see.” He argues with satisfaction, though, that U.S. friends are more reassured by U.S. policy today than they were even six months ago: “I think that the idea of the ‘rebalance’ has now taken hold.” He notes that the U.S. is advancing toward its goal of placing 60% of its air and naval assets in the Pacific by 2020, and though defense budgets haven’t grown, the Navy is building to a fleet of 308 ships, from 287 five years ago. “So I can stand in front of anybody and tell them what I believe—the military component of the rebalance is real.” Various aspects of China’s record, meanwhile, aren’t as bad as they may seem. Yes, Chinese fighter jets have recently made several unsafe intercepts of U.S. surveillance planes in international airspace, but Adm. Harris assesses that these were caused by “poor airmanship, not some signal from Chinese leadership to do something unsafe in the air.” He also touts the Code for Unplanned Encounters at Sea signed by the U.S. and Chinese navies two years ago, even though Beijing has refused to apply similar protocols to its coast guard and law-enforcement fleets that do most of its bullying at sea. “We recognize that there’s a gap there,” but “we shouldn’t discount the positives because there are still negatives. We should embrace the positives, continue to work on them, and then work on the negatives.” Some might see this as a risky standard of low expectations, yet Adm. Harris emphasizes that China’s military arrived on the global stage recently, so a little acceptance can go a long way. Hence the U.S. decision to include China’s military for the second time in the multinational Rimpac naval exercise that concluded this week off Hawaii, and to welcome its role in everything from counterpiracy patrols off the Horn of Africa to the removal of chemical weapons from Syria and the search for Malaysia Airlines Flight 370. “These are positive things” that “demonstrate how far China has come and where we are welcoming their arrival,” Adm. Harris says. “We don’t want China to be isolated. Isolation is a bad place to be. . . . It’s dangerous.” U.S. leaders clearly hope this message may chasten China. Defense Secretary Ash Carter recently adapted Adm. Harris’s coinage, warning Beijing that its aggressive behavior could leave it stuck behind a “Great Wall of Self-Isolation.” Whether Chinese leaders are sensitive to this risk remains to be seen, and much of the evidence isn’t promising, but U.S. outreach seeks to convey that the choice is theirs. “It’s on China not to be isolated,” says Adm. Harris. “It’s on them to conduct themselves in ways that aren’t threatening, that aren’t bullying, that aren’t heavy-handed with smaller countries.” Which raises a basic question: At what point is it prudent to conclude that China is committed to the path of bullying and revanchism? After all, its top diplomat boasted in 2010 that “China is a big country and other countries are small countries, and that’s just a fact,” and its posture has hardened since. Adm. Harris isn’t losing faith. “I believe China seeks hegemony in East Asia,” he told Congress in February, but he says this observation isn’t incompatible with the ambition that China become a “responsible stakeholder” in the liberal, rules-based international order. “We want China to be a strong power that adheres to and supports the rule of law,” he says. It would be nice if the U.S. presidential campaign discussed these issues, but that’s apparently too much to ask. Adm. Harris, who knows Hillary Clinton well from serving as her military aide from 2011 to 2013, declines to offer any message to the candidates or voters. But his remarks are peppered with points that the next president would be well-advised to consider. “We have to maintain credible combat power,” he says, citing assets including fifth-generation fighter aircraft, intelligence capabilities and submarines, which he calls “the biggest asymmetric advantage we have over any adversary we might face.” He also implies that defense budgets are too tight, especially as he looks past this year and next. “I’ve been accused of having an insatiable desire for stuff,” he says. “That’s only because the president has an insatiable desire for security.” On nuclear issues he defers to his Naval Academy classmate Adm. Cecil Haney, commander of U.S. Strategic Command, but notes that the U.S. nuclear “deterrent is a must-do, a must-have, whatever the cost.” Then there’s what Adm. Harris calls the “main battery”: diplomacy. Deepening ties with India is a “huge opportunity,” he says, and all the more so if Australia and Japan are involved too, as leaders in the four countries have discussed on and off for a decade. The “most important” diplomatic opportunity he sees is expanding cooperation among the U.S., Japan and South Korea, which recently held trilateral missile-defense exercises for the first time. This is crucial both for defending against North Korea and signaling to China that U.S. alliances are robust. Finally there’s the U.S. economic role in Asia, which Adm. Harris says is less noticed but more important than its military presence. He avoids mentioning the pending trans-Pacific trade deal that has been pilloried by presidential candidates of both parties, but last year he said it would reduce instability and cement U.S. influence in Asia. Mrs. Clinton used to agree. She’d have sound strategic reasons to reconsider if she wins the Oval Office.” http://www.wsj.com/articles/a-pacific-admiral-takes-chinas-measure-1470436129

The Caucus Brief is a daily publication for Members of Congress and Hill Staffers on China news and information compiled by the office of Congressman Randy Forbes, Founder of the Congressional China Caucus. Email alex.gray@mail.house.gov with tips, comments, or to subscribe/unsubscribe.

Abe’s Pick Of Nationalistic Inada As Defense Chief Riles China. Kyodo Times. “China’s state-run media has slammed Prime Minister Shinzo Abe’s choice of right-leaning nationalist Tomomi Inada as the country’s new defense minister. China Central Television said on Wednesday the appointment showed “how Japan’s security policy is swinging all the more to the right,” urging heightened vigilance amid the trend. The CCTV report called Inada a “typical right-wing politician,” noting her repeated visits to the contentious Yasukuni Shrine in Tokyo and her calls to amend Japan’s pacifist Constitution and boost the nation’s military strength. Inada, who was policy chief in Abe’s Liberal Democratic Party, replaced Gen Nakatani as defense minister. She is known for sharing views with Abe on security and foreign policy and has been outspoken on controversial historical issues involving Japan’s neighbors. Xinhua News Agency, citing observers, reported that Inada’s appointment “was made due to Abe’s ongoing push to expand the operational scope of the nation’s Self-Defense Forces.” It said her appointment “will draw the ire of Japan’s neighboring countries for her controversial revisionist remarks and opinions on history, as well as her regular visits to the war-linked Yasukuni Shrine,” which honors class-A war criminals from World War II along with the nation’s war dead. On Tuesday, Chinese Foreign Ministry spokesman Hua Chunying accused Japan of “attempting to justify its military expansion and its shake-off of postwar bondage by exaggerating security threats in the neighborhood.” “We urge the Japanese side to learn from history, stick to the path of peaceful development, watch its words and actions in the military and security fields, and contribute to enhancing mutual trust with its neighbors by maintaining regional peace and stability instead of the opposite,” he said. Hua’s remarks came after Japan earlier Tuesday issued a defense white paper that highlighted concern over the Chinese military’s muscle-flexing in the East and South China seas. Meanwhile, in Washington on Wednesday U.S. State Department spokesman Mark Toner declined to comment on Inada’s appointment as defense minister. “I don’t want to get into commenting on what we consider to be really domestic politics in Japan,” he said. But Toner hinted at Washington’s opposition when asked about the possibility that Inada may continue to visit Yasukuni Shrine. “I’d just say we continue to emphasize the importance of approaching historical legacy issues with — in a manner, rather, that promotes healing and reconciliation,” Toner said. “And that’s always been our position regarding the shrine.” http://www.japantimes.co.jp/news/2016/08/04/national/politics-diplomacy/abes-pick-hawkish-inada-defense-chief-riles-china/#.V6N6RqLXu9g

Chinese Hackers Breached Networks To Gain Upper Hand In South China Sea Dispute. Eric Geller, Politico. “Chinese hackers attacked a government agency, a diplomatic summit organizer and an international law firm to gain intelligence about a legal dispute over the South China Sea, a leading security company said today. "Based on the specific selection of organizations targeted for attack by this malware, as well as indications revealed in our technical analysis of the malware itself, we believe the threat actor to be of Chinese origin," researchers at F-Secure Labs wrote in a white paper. The hackers used the malware to access computer systems containing confidential information about a legal fight between China and the Philippines, which opened arbitration proceedings after accusing China of violating international law by claiming certain territory in the sea. The regional dispute has been a key source of friction between the U.S. and China. The malware-laden spearphishing emails went to the Philippines Department of Justice, a law firm representing one of the parties in the case, and organizers of an Asia-Pacific Economic Cooperation summit, which President Barack Obama and Chinese President Xi Jinping both attended. "Our technical analysis indicates a notable orientation towards code and infrastructure associated with developers in mainland China," F-Secure researchers wrote. "In addition, we also consider it significant that the selection of organizations targeted for infiltration are directly relevant to topics that are considered to be of strategic national interest to the Chinese government." The malware first appeared in January 2015 and continues to circulate today, according to F-Secure's analysis. An arbitration panel ruled in favor of the Philippines on July 12.” https://www.politicopro.com/cybersecurity/whiteboard/2016/08/chinese-hackers-breached-networks-to-gain-upper-hand-in-sea-dispute-075563

Meet The China ‘Whisperers’ Who Get The Big Deals Done In Silicon Valley. Elizabeth Dwoskin, The Washington Post. “When Uber chief executive Travis Kalanick wanted advice about whom to hire to run his ride-hailing business in China, he asked Carmen Chang, a longtime Silicon Valley lawyer and investor who had helped a previous generation of tech companies navigate that murky territory. When Uber sold its China business to its rival Didi this week, Chang was a trusted confidante. When Lyft, Uber’s smaller rival, needed an entree into China, the company’s president turned to another Silicon Valley insider who shuttles between worlds. The introduction from Connie Chan, a partner at the venture capital firm Andreessen Horowitz, to China’s largest ride-hailing company led to a $100 million investment and partnership. Behind the scenes of an unprecedented flood of capital from China into Silicon Valley over the past two years is an elite network of brokers. These brokers do more than deal-making; they play anthropologist and cultural translator -- from coaching startup founders about the culturally appropriate place to sit at a conference room table in China to breaking down how emojis are used in Chinese apps. Their acumen is growing more valuable, entrepreneurs say, as they navigate a cast of hard-to-parse characters with alluring deep pockets and promises of big business opportunities overseas. “She is the whisperer between China and Silicon Valley,” said Matthew Prince, chief executive of Cloudflare, a web security startup, of Chang. Last year, Chang helped Prince -- whose company had given up on China in 2011 -- clinch a partnership with Baidu, China’s search giant. “There’s very few that really understand both sides.” Chang, who was born in Nanjing, China, came to the States to seek a doctorate in Modern Chinese History. She got pulled into tech industry after graduating from Stanford Law School in the early 1990s, when she got a job as an associate at Wilson Sonsini Goodrich & Rosati, the Silicon Valley firm known for its ties to the clubby venture capitalists on Sand Hill Road. One of her early clients was Masayoshi Son, the billionaire Japanese investor who founded the Japanese telcommunications giant Softbank. At the time, she said, senior management at the firm had never been to Asia, and Son “wasn’t considered important enough” to be represented by a general partner. “So he got an associate,” she says. The lack of knowledge about the role Asia was beginning to play in the technology industry worked to Chang’s advantage, as she was able to build a client roster and contacts that became a who’s who in Asian tech. In the years that followed, Chang became involved in a string of deals, some of which have become lore in Silicon Valley. She helped Hank Paulson, then chief executive of Goldman Sachs, break into China. She represented Google when it acquired a stake in Baidu in 2004. In 2003, she facilitated a joint venture between network infrastructure firm 3Com and China’s Huawei Technologies -- one of the first between Silicon Valley and a Chinese company. Today, Chang says the relationship between Silicon Valley and China has reached a turning point. In the last two years, internet giants like Alibaba, Baidu and Tencent -- sometimes referred to as the Amazon, Google and Facebook of China -- as well as dozens of private investors and state-owned enterprises have flooded Silicon Valley with cash, spending billions in a race to access cutting-edge technology. Their presence has been enticing for young companies, who see these investors as a powerful new source of capital that can keep them afloat and a path to doing business in China. As China’s tech sector develops -- major cities are already saturated with ride-sharing, messaging and apps for on-demand services – it’s harder for U.S. companies to do business there. As a result, the reliance on networks of brokers and investors is growing, entrepreneurs said in interviews. Venture capital firms have responded to the cash influx by building out their relationships with Chinese and other foreign investors – and growing their coffers in the process. To that end, Chang was recruited to become a partner at the venture firm New Enterprise Associates in 2013. There she has brokered China partnerships for many portfolio companies. Her hidden hand goes beyond deals: Last year, she helped to recruit Liu Zhen, a lawyer from a prominent Chinese family who had worked for her at Wilson Sonsoni, to head up Uber’s China business (NEA is an investor in Uber). Like any other dealmaker, the China whisperers must manage the often competing interests of investors and entrepreneurs — but they do so in the context of a larger culture clash that has at times led to distrust on both sides. Chinese investors are by definition outsiders to Silicon Valley — they want to gain access to the hot deals but have fewer connections to do so. Today, it’s very common to see many Chinese investors in the audience at startup incubator “demo days” — when nascent companies pitch to an audience of would-be funders. Still it can be tough to get in. Some brokers say that Chinese investors rarely access the early and most potentially lucrative fundraising rounds of a hot company. In the case of state-owned enterprises, some U.S. startups don’t want to take their money - or even take meetings with them - for fear that they will become too enmeshed with the Chinese government, some brokers said. But sometimes it is the U.S. startups who perceive the Chinese as unfair. They can be seen as aggressive negotiators, said George Zachary, a partner at the venture capital firm CRV. Startups and other investors are wary of giving up too much control. Chang says she has to manage concerns by Chinese investors that they are getting the short end of deals. Huawei recently made a deal with one of her startups, the 3-D photo app Fyuse. “I wanted to make it clear to them that we would never treat them like dumb money or treat them differently from other investors,” Chang said. “We would treat them fairly.” Negotiating a joint venture is one of trickiest aspects of working with Chinese investors. In the last three years, Chinese regulations and practices have made it more complicated for U.S. companies to do business there, Chang says. For that reason, startups usually enter the market in the form of a partnership. Today, these partnerships are often based in the Cayman Islands because China doesn’t allow foreign ownership of companies. In negotiations, for example, Chinese partners often insist that the data of Chinese citizens cannot be stored on U.S. servers and that legal disputes must be settled in Chinese or Hong Kong courts. Previously, arbitration in Santa Clara County was a sticking point for U.S. companies; now that battle has largely been lost, she says. Around the same time that Chang joined NEA, Chan of Andreessen Horowitz began to build out a China network for the firm. Liaising with Asia is now Chan’s full-time job. In addition to making what she calls “warm introductions” that can lead to deals, she has a Rolodex of lawyers, accountants, investors manufacturers and Chinese media that can help the firm’s companies navigate their way abroad. Often she plays cultural translator - doing things like helping startups understand Chinese products and assess the competition. “I say, okay, here are the four companies you should track,” she says. “This is their Chinese name. Go set a Google Alert. Have someone who understands Chinese in your company do a screenshot by screenshot walk-through ... and repeat every six months.” Chan, who is 32 and soft-spoken, is becoming known as something of an expert on explaining Chinese products and technology trends to the wider public. In 2014, she wrote an extensive blog post about the Chinese messaging app WeChat. With 549 million monthly users, it’s one of the largest messaging apps in the world. “Few outside China really understand how it works,” she wrote, “how it can pull off what for many companies (and countries) is still a far-off vision of a world managed entirely through our smartphones.” She went on to explain how people in China hail taxis, order food, buy movie tickets, get their bank statements, search for books at the local library and read news -- all through text messages. The blog, by all accounts a wonky breakdown of a Chinese app, went viral. It was listed by New York Times columnist David Brooks as one of the best essays of 2015. The go-go climate has also given rise to other new players, such as Danhua Capital, a two-year-old venture capital firm led by Shoucheng Zhang, an award-winning Stanford physicist who has used his connections and fame in China to raise a $350 million fund and invest in dozens of companies on behalf of newly wealthy employees of Chinese internet giants. Zhang, a Chinese scientific prodigy who came to the United States in the '80s, has long had a front-row seat on the China-Silicon Valley relationship: At a gathering for a Bay Area Chinese American nonprofit that Zhang founded, Jack Ma was introduced to Yahoo co-founder Jerry Yang, he says. The casual introduction led to Yahoo’s storied investment in Alibaba. The physicist wasn’t interested in investing himself until he saw an opportunity in the number of Chinese coming to Silicon Valley with a “hunger to learn.” He says he is inspired by the idea of applying scientific principles to business. “The bridge between China and the U.S. is one of the biggest challenges of globalization - it’s a critical moment of transition,” he said. “If we don’t do it well, it will be a great lost opportunity.” On another end of the spectrum are people like Wei Guo, a Chinese-born, Western-educated 27 year old who has raised multimillion dollar fund from family friends and invested in over 100 U.S. startups. His investors, he said, do not care if they lose their money so long as they gain exposure to exciting technologies. Brokers say that sometimes misperceptions arise because business culture in China is so different. In China, where there’s less rule of law and a powerful government relentlessly pushing for growth, brass-knuckled tactics are far more common. Taking ideas from a company you invest in and giving them to another is more acceptable, for example. Chang says she has been able to be effective, in part, because she makes a point of never questioning anyone’s honesty or integrity; acting suspicious can deeply offend people and escalate conflict. In any deal, she coaches both sides to be aware of the messages they are projecting. “I’ve told U.S. companies, Chinese people have long memories and are the ultimate repeat players, so don’t play any games,” she says. “And I’ve tried to tell the Chinese investors coming the Valley today that they are making their reputation as they go along, so they should be very thoughtful and careful about what they do.” She also only does business with people she knows well. But Chan says some of the confusion is also a function of being an outsider to clubby Silicon Valley. When Chinese are investing in the United States, “it’s harder for them to have a full perspective of the competitive landscape or a full understanding of how to vet that entrepreneur’s background,” she says. “In China, so much of business is relationship-based.” https://www.washingtonpost.com/news/the-switch/wp/2016/08/04/meet-the-china-whisperers-who-get-deals-done-in-silicon-valley/

Philippines Pulls Back On Fishing At Scarborough Shoal. Maritime Executive. “The Philippine government has asked Filipino commercial fishermen to avoid some of the most hotly contested waters in the South China Sea, despite a recent international court decision affirming their fishing rights. “Scarborough [Shoal] is really just for artisanal fishing. Basically, artisanal fishing and it should be left alone by those who are engaged in commercial fishing,” spokesperson Ernesto Abella said Wednesday. Artisanal fishermen "can still go to [Scarborough Shoal] but they are advised to proceed with caution," he added. "Some guidelines are already in place. You know, for example, there should be no commercial fishing within Scarborough. So, that's already in place. It's not a new one. It's just being implemented," he clarified. "We are simply saying that there are certain kinds of fishermen who are allowed and who should be there and can fish inside." He added that he believed that there are "hardly, if any at all, artisanal fishers" at Scarborough, which lies 120 nm off Luzon. The Philippines recently won a ruling from the Permanent Court of Arbitration in the Hague, which found that China's claims to most of the South China Sea and to the waters surrounding many of its land features were invalid. China has disregarded the ruling, describing it as "waste paper," and its Supreme Court recently warned that fishermen found in "Chinese" waters could be jailed. Chinese forces have chased Philippine fishermen and activists away from Scarborough Shoal for some time, and reports indicate that this has not changed following the court ruling. China has maintained a Coast Guard and maritime law enforcement presence at the shoal since 2012. The recently elected Philippine government of Rodrigo Duterte has made conflicting statements on the issue of South China Sea sovereignty, and has not played up the favorable court ruling. Abella's remarks build on statements made by the government immediately following the court's decision, when it asked fishermen to proceed carefully at Scarborough and near other contested land features. The statements run contrary to a promise Duterte made in June that “there will never be an instance that we will surrender our right over Scarborough Shoal.” http://maritime-executive.com/article/philippines-pulls-back-on-fishing-at-scarborough-shoal

China Signs Nuclear-Powered Icebreaker Deal. Maritime Executive. “A cooperation deal signed between China National Nuclear Corporation and China State Shipbuilding Corporation will accelerate the development of nuclear-powered icebreakers and maritime nuclear power platforms, according to local media reports. China currently has one diesel-powered icebreaker, the Ukraine-built Xue Long, but another has been slated for construction. The new nuclear-powered design for the Polar Research Institute vessel is expected to cost more than a billion yuan ($154 million) and take around two years to build. Construction is expected to begin at the end of 2016. The vessel will feature higher ice capabilities, better research capabilities and be more comfortable and environmentally friendly than Xue Long. It is expected to be 122.5 meters (400 feet) long and will be able to break ice of up to 1.5 meters (five feet) thick at a speed of around two knots. It will be able to operate bow or stern first using two ABB Azipod units with combined power of 15MW. China commissioned its latest naval icebreaker, Haibing 722, in January. The vessel is assigned to the Chinese Navy's Northern Fleet to patrol the Bohai Sea. China’s interest for the Arctic has steadily increased over the last decade, and the country is now an observer to the Arctic Council. In northern Russia, Chinese investments are seen in both Yamal LNG and other petroleum projects.” http://maritime-executive.com/article/china-signs-nuclear-powered-icebreaker-deal

The Decades Long Dance Between China And Taiwan. War On The Rocks. “The past several months have seen a significant elevation of tensions in the western Pacific. The biggest event was probably the Permanent Court of Arbitration (PCA) findings, which overwhelmingly favored the Philippines, the claimant, in its disputes with the People’s Republic of China regarding the South China Sea.Yet as important, if less noticed, was the suspension of all formal communications between China and Taiwan’s government. After an eight-year period of relative tranquility in the Taiwan Straits, it appears that cross-straits tensions will soon be on the rise again. Indeed, these two events in combination are likely to significantly raise tensions from the Senkaku Islands to the Straits of Malacca.Beijing suspended formal cross-straits communications in reaction to the new government in Taipei, as the Chinese leadership is intent on bringing this new government to heel. With the inauguration of Tsai Ing-wen, Taiwan saw the fourth democratic transition in the island’s leadership since the end of martial law in the 1990s. Tsai, head of the Democratic Progressive Party (DPP), had already scored a major victory over the Kuomintang’s (KMT) Eric Chu in presidential elections this past January. Riding Tsai’s momentum, the DPP also won enough votes to secure control of the Legislative Yuan, Taiwan’s legislature, reflecting broad public support for the party.Since a key raison d’etre of the DPP is a belief in Taiwanese independence (along with progressive social policies), tensions with Beijing are often focused on whether Taipei will push for independence from Beijing. But the rancor between the two sides of the Straits predates the return of the DPP to power. Instead, it has roots in the five decades between the waning days of imperial China and the end of the Chinese Civil War in 1949.The Impact of Japanese Colonialism. Taiwan had long been something of a land apart, following different paths from the Chinese mainland. After the Ming Dynasty was conquered by the Manchu invaders of the Qing dynasty, some of its loyalists, led by Zheng Chenggong (also known as Coxinga) based themselves on Taiwan. They hoped to use it as a springboard to restore Ming rule and waged a multi-decade campaign to that end.This divergence became even more prominent after imperial China ceded Taiwan to Japan after the First Sino-Japanese War (1894-1895). That war made Japan an imperialist nation, as Japan also came to dominate the Korean peninsula as part of its sphere of influence. For authorities in Tokyo, Taiwan was an opportunity to showcase that Japan could be as effective an imperial power as its European counterparts. Over the course of five decades, various administrative policies were implemented depending upon the attitude in Tokyo. These policies all sought to assimilate the island’s population into the larger Japanese empire, but differed in degree. Notably, the population on Taiwan was generally treated much less brutally than Koreans. Japan oversaw the expansion of local infrastructure (including transportation), public health measures (a reduction in the incidence of diseases such as malaria), and the establishment of a public school system.As a result, Taiwanese perceptions of Japan were not only different from those of Koreans, but also from those of the Chinese on the mainland. Unlike their counterparts across the straits, many of the people on Taiwan did not see the establishment of Kuomintang (Nationalist) authority on the island in the wake of Japan’s surrender as an improvement. These differing perceptions led many Taiwanese to chafe at Kuomintang administration, often seen as corrupt. Issues came to a head in the “228 incident,” when KMT forces and Taiwanese protestors clashed on February 28, 1947. The subsequent crackdown led to thousands of Taiwanese casualties and the imposition of martial law, which was not lifted until 1987.The Rise of a Taiwan Identity.After the Kuomintang regime fled the mainland for Taiwan in 1949, the island was essentially under political and sometimes military siege. For much of the next three decades, the KMT battled with the Chinese Communist Party (CCP) for international recognition, while maintaining the posture of striving to retake the mainland. The American opening to Beijing in the early 1970s, however, made it clear that these prospects were steadily receding.When Chiang Ching-kuo, son and successor to Chiang Kai-shek, ended martial law on the island, it essentially marked the recognition that Taiwan was unlikely to retake the mainland in the foreseeable future. The end of martial law and the advent of free elections meant that the population on Taiwan would have more political options.At the same time, a sense grew of a Taiwanese (as opposed to a Chinese) identity among the inhabitants of the island. Many of those born and raised on the island for generations had not given up their desire for independence, though this was muted by the strictures of martial law. Meanwhile, the children and grandchildren of those who had fled the mainland increasingly saw themselves as distinct from those who had stayed behind. In part, the founding of the DPP in 1986 reflected a coalescing of these diverse elements.This growing sense of Taiwanese identity alarmed the CCP leadership. It was one thing to face a Taipei that believed it was the legitimate government of all of China. It was an entirely different problem to confront a Taiwan that rejected reunification and was interested in independence. Beijing’s concerns were exacerbated by the rise of Lee Teng-hui, Chiang Ching-kuo’s vice president and successor.Although a member of the KMT, Lee had been born on Taiwan while it was under Japanese rule. Lee had served in the Imperial Japanese Army during World War II and spoke Japanese fluently. Many in Beijing believed that he supported Taiwanese independence. His actions were therefore interpreted as efforts to establish a Taiwanese identity and create diplomatic space. Things came to a head in 1995. Despite promises to Beijing by U.S. Secretary of State Warren Christopher that Lee would not be granted a visa to visit America, U.S. congressional leaders intervened with the State Department to give Lee permission to visit Cornell University (his alma mater). The result was the Third Taiwan Straits crisis. As the Republic of China prepared for the first direct election of a president in 1996, in which Lee the favored candidate, Beijing sought to intimidate the population by testing missiles in waters both north and south of the island. Their apparent goal was to force Taiwan to formally accept the formula of “one country, two systems” and effectively renounce any possibility of ever pursuing independence. The United States responded to the Chinese missile tests by dispatching two carrier groups to the waters off Taiwan, marking the nadir of Sino-U.S. relations since the Tiananmen Massacre only six years previously. The Chinese effort failed, as Lee was elected to the presidency in 1996, without acceding to the Chinese pressure.The Rise of the DPP. During his term as president, Lee promoted “Taiwanization,” a broad effort to instill a sense of identity for Taiwan distinct from that of China. These efforts gained further impetus after the 2000 election won by DPP candidate Chen Shui-bian. Chen was a fervent supporter of Taiwanese independence, so much so that he managed to alienate the United States by suggesting that the United States would have no choice but to support Taiwan. While the United States has opposed any use of force to resolve the Taiwan Straits issue, it has simultaneously avoided encouraging a deliberate Taiwanese effort to alter the status quo. Any outright Taiwanese declaration of independence would constitute precisely such a unilateral step. Nonetheless, Chen embodied the debate that was ongoing in Taiwanese society. As the generation that fled the mainland died from old age, a growing sense of a distinct, Taiwanese identity has taken hold, even among those whose ancestors were not born in Taiwan. Many on Taiwan in the 1950s and 1960s had presumed a single China, but argued over whether the KMT or the CCP was its rightful government. By contrast, there has been a growing sense among many born on Taiwan since then that Beijing is welcome to China, but not to Taiwan. Chen’s presidency marked a low point in cross-Straits relations, as Beijing felt it difficult to work with Chen. This was exacerbated by divided government in Taipei, as the KMT still dominated the Legislative Yuan, leading to legislative gridlock. While Chen won reelection in 2004, the political pendulum swung back to the KMT in 2008, when Ma Ying-jeou won the presidential elections and the KMT retained the legislature. Ma sought to reduce tensions with Beijing and made a point of avoiding discussions of independence. Cross-Straits relations improved, including the passage of the Economic Cooperation Framework Agreement (ECFA), which eased a number of restrictions on trade and other interactions, such as allowing direct flights between China and Taiwan. A variety of domestic political missteps and a general economic downturn led to plummeting approval ratings for Ma, and in 2016, the KMT decisively lost to the DPP in elections that saw the DPP take control of not only the presidency, but also the Legislative Yuan. Tsai Ing-wen. While the DPP has generally stood for Taiwan independence, Tsai has been very careful in her comments and remarks not to push for separation. During her campaign and in prior visits to the United States, she has avoided antagonizing Beijing by openly advocating independence. Nonetheless, Beijing has insisted that she must explicitly acknowledge the “one-China” principle, in effect formally and publicly rejecting the idea of Taiwan independence. This would include publicly accepting the “1992 Consensus,” a framework reportedly reached by semi-official representatives from the two sides in 1992, whereby both sides agreed that there was only one China with a government in dispute, and that Taiwan was part of it. President Tsai did not explicitly endorse either the “one China” principle or the “1992 Consensus” in her inauguration speech — hardly surprising given both the centrality of Taiwanese identity and independence in the DPP, as well as the overwhelming victory the party had achieved. Nonetheless, her speech and various comments have not challenged the status quo. Yet China still warned that failure to acknowledge the “one-China” principles would lead to the suspension of cross-Straits dialogue, a threat that it has now fulfilled. Chinese officials tied the ending of talks directly to Tsai’s failure to explicitly acknowledge that Taiwan is part of China or otherwise formally reject any move towards independence. Taiwan and the South China Sea Issue. China’s actions towards Taiwan, coupled with its possible reactions to the PCA findings, raise the likelihood of greater tension in the East and South China Seas. Indeed, the PCA’s conclusion that Itu Aba, the largest natural formation in the Spratlys, is not an island aroused a reaction from Taipei as well as Beijing. Taiwanese authorities rejected the PCA’s conclusions, and noted that Taipei was not consulted in the case, even as the court ruled on the status of Itu Aba (which is held by Taiwan). The break in formal communications between Beijing and Taipei, in this regard, is likely to exacerbate the situation, as Taiwan holds the original documentation regarding the “nine-dash line” that Beijing has used as the basis of its claims. If Taiwan were to reinterpret its position, such as by only claiming the land features within the South China Sea but making no formal claims regarding the waters, this would leave China even more isolated than it is now. Chinese efforts to isolate Taiwan under the DPP may therefore actually backfire if the Tsai government were to conclude that there was no reason not to differentiate itself further from the mainland. This is an especially powerful argument, given the importance Taipei, and especially the DPP, has given to acting in accordance with international law and norms. Should Beijing pursue a South China Sea air defense identification zone (ADIZ), as some have posited, then the pressure on Taiwan to distance itself from Chinese actions would likely grow. Taiwan is unlikely to want to alienate its southeast Asian neighbors, and further isolate itself, by supporting such a unilateral Chinese act. On the other hand, acting like a responsible player may expand Taiwan’s limited relations and diplomatic space—but at the cost of further alienating China. If, however, Beijing has already decided to limit its interactions with Taipei, then its ability to bring further pressure to bear will be limited. For China, then, its decision to reduce contacts with Taiwan, even as it finds itself more isolated on the South China Sea issue, is creating a conundrum. China needs Taiwan to bolster its position regarding the South China Sea, but its suspension of interaction gives the authorities in Taipei little reason to cooperate.” http://warontherocks.com/2016/08/the-decades-long-dance-between-china-taiwan/

China Blames 'Dark Shadow' Of The U.S. For Hong Kong Independence Push. James Griffiths and Vivian Kam, CNN. “Beijing has accused the U.S. of working with so-called separatists in Hong Kong and Taiwan to undermine China and plunge it into chaos. In a video posted online by the Chinese Supreme People's Procuratorate, apocalyptic images of Syria and Iraq are contrasted with bucolic views of China today. "The haze of 'domestic and international concerns' has not dispersed from the Chinese sky," the video says. "Tibet, Xinjiang, Hong Kong and Taiwan separatism, as well as dissident leaders, lawyers who would fight until death and other agents of Western forces are damaging China's internal stability and harmony. Behind all these incidents, we can often catch a glimpse of the dark shadow of the Stars and Stripes." In a post on Weibo, the Procuratorate urged people to "stay alert for color revolutions" or see "peaceful and stable China" become like Syria or Iraq. A warning against independence movements in Taiwan and Hong Kong is overlaid on photos of Joshua Wong -- a leading Hong Kong pro-democracy campaigner and founder of Demosisto -- and Taiwanese President Tsai Ying-wen. In a statement, Wong dismissed the video as laughable, adding that it was full of "false statements" and highlighting the sentencing Tuesday of Chinese human rights lawyer Zhai Yanmin for plotting to subvert state power. "(Zhai's sentence) proves the mainland justice system has no credibility," Wong said. Beijing's dark warnings come as authorities in Hong Kong barred several pro-independence politicians from standing in the upcoming elections to the Legislative Council, the city's parliament. Edward Leung of Hong Kong Indigenous, who won 15.4% of the vote in a by-election last year, was blocked by the Electoral Affairs Commission from running in September's race. Speaking to reporters, Leung denounced the commission's decision as political censorship, warning that Hong Kong will never have true democracy as long as it is under Chinese control and he called for revolution. Leung is one of five candidates who have been told they will not be allowed to run, including Chan Ho-tin of the Hong Kong National Party and Alice Lai Yee-man of the Conservative Party, which advocates for Hong Kong to return to British control as a route to independence. Both Leung and Lai signed declarations vowing to uphold the Basic Law, Hong Kong's mini-constitution, as required by the EAC, but were nevertheless barred from running. Other candidates who have been approved to run have complained of their political leaflets -- the free distribution of which is a right granted to candidates -- being blocked by the EAC. Ma Ngok, a professor at the Chinese University of Hong Kong, said the EAC's bungling of the registration process could lead to a bump in support for more radical candidates. "Voters may seek to send a message to Beijing by casting a vote for these groups," he told CNN. The EAC did not respond to a request for comment.” http://edition.cnn.com/2016/08/03/asia/china-anti-us-propaganda-hong-kong/index.html

Taiwan Establishes Submarine Development Center. Wendell Minnick, Defense News. “Taiwan-based China Shipbuilding Corporation (CSBC) established a submarine development center on Monday to support the construction of six to eight diesel electric submarines under the Indigenous Defense Submarine (IDS) program. The Taiwanese Navy has a requirement to replace two inoperable World War II-era Guppy-class attack submarines as well as the life extension program for its two Dutch-built Sea Dragon-class (Zwaardvis Mk 2) submarines built during the early 1980s. The new Submarine Development Center of CSBC (SDCC) will produce a design for the IDS under a budget of $95 million by the end of this year. Taiwan’s Navy has expressed frustration since the U.S. agreed to assist Taiwan in the acquisition of eight diesel attack submarines in 2001, but was unable to fulfill the promise due to pressure from China and technological challenges. The U.S. has not built a diesel electric submarine since the Barbel-class in the 1950s. “CSBC's establishment of a submarine development center is a positive sign,” said Mark Stokes, executive director of the Project 2049 Institute, a think tank based in Washington, DC. “Taiwan's defense industry is taking the submarine program seriously. If licensed, U.S. partners have a supporting role to play in the IDS program.” Stokes served as the Pentagon’s team chief and senior country director for Taiwan in the Office of the Assistant Secretary of Defense for International Security Affairs during the 2001 arms release. He is described by many within the U.S. and Taiwan defense industries as a major advocate of Taiwan’s acquisition of submarines. The SDCC announcement comes only a month before the 2016 Kaohsiung International Maritime and Defense Industry Expo. Taiwan’s Navy is implementing a wide-ranging fleet modernization effort that includes Aegis destroyers, frigates, high-speed minelayers, landing platform docks, additional stealthy Tuo Jiang-class missile corvette catamarans and multi-purpose transports. There is some skepticism in Taiwan over the IDS and the larger fleet modernization and recapitalization efforts. Ching Chang, a research fellow of the Taipei-based Society for Strategic Studies and former Taiwan naval officer, sees a potential incentive to drive associated economic activities in the manufacturing and service sectors. However, “one leaf makes no autumn,” Chang said; his concern is that the limited numbers of build programs will not survive beyond domestic demand. This was the case, Chang said, with the production of the Indigenous Defense Fighter during the 1990s that ceased after 130 aircraft and the line closed. Ultimately the real decision on whether Taiwan has a successful submarine and surface vessel recapitalization program lies in Washington, DC, which approves much of the advanced technological defense exports Taipei relies so heavily on, Chang said. With the coming election, there will be a delay until summer when the new U.S. National Security Council settles into work and examines the request in accordance with the incoming president’s policy goals.” http://www.defensenews.com/story/defense/naval/submarines/2016/08/03/taiwan-submarine-navy-modernization-csbc/88001218/

China Court Warns Against Illegal Fishing In Riposte To South China Sea Ruling. Ben Blanchard, Reuters. “China's Supreme Court said on Tuesday people caught illegally fishing in Chinese waters could be jailed for up to a year, issuing a judicial interpretation defining those waters as including China's exclusive economic zones. An arbitration court in the Hague ruled last month that China had no historic title over the waters of the South China Sea and that it had breached the Philippines' sovereign rights with various actions in the sea, infuriating Beijing, which dismissed the case. None of China's reefs and holdings in the Spratly Islands entitled it to a 200-mile exclusive economic zone, the court decided. China's Supreme Court made no direct mention of the South China Sea or the Hague ruling, but said its judicial interpretation was made in accordance with both Chinese law and the U.N. Convention on the Law of the Sea (UNCLOS), under which the Philippines had brought its case. "Judicial power is an important component of national sovereignty," the Supreme Court said. "People's courts will actively exercise jurisdiction over China's territorial waters, support administrative departments to legally perform maritime management duties ... and safeguard Chinese territorial sovereignty and maritime interests." Jurisdictional seas covered by the interpretation include contiguous zones, exclusive economic zones and continental shelves, it said. People who illegally entered Chinese territorial waters and refused to leave after being driven out, or who re-entered after being driven away or being fined in the past year, would be considered to have committed "serious" criminal acts and could get up to a year in jail, the Supreme Court said. "The explanation offers legal guarantees for marine fishing law enforcement," it added. China's defense minister Chang Wanquan warned of offshore security threats, especially threats from the sea, and said China should prepare for a "people's war at sea" to safeguard national sovereignty, the official Xinhua news agency reported. China claims most of the South China Sea, through which more than $5 trillion of trade moves annually. Brunei, Malaysia, the Philippines, Taiwan and Vietnam have rival claims. China periodically detains fishermen, especially from the Philippines and Vietnam, and Chinese fishermen also occasionally get detained by other claimants in the South China Sea. Separately, China's military has inaugurated a memorial to servicemen who died in 1974 clashes with South Vietnamese forces that resulted in China cementing its rule over the Paracel Islands, the People's Liberation Army Daily said. The memorial, on Duncan Island, commemorates the 18 Chinese who died, the paper added.” http://www.reuters.com/article/us-southchinasea-ruling-idUSKCN10D0B1

Sulu Sea Joint Patrol Agreement Signed. Maritime Executive. “The Philippines, Malaysia and Indonesia have reached an agreement to permit joint operations in all three nations’ territorial waters – including the right to chase suspected pirates across boundary lines in "hot pursuit" enforcement actions. The joint patrol agreement is an attempt to combat an outbreak of maritime piracy and kidnappings perpetrated by terrorist organization Abu Sayyaf, which is associated with ISIS and Al Qaeda. Defense ministers from the three nations met in Bali on Tuesday to sign an agreement on "standard operational procedures" for naval cooperation. “The SOP later will provide details on how long Indonesian personnel can stay in Malaysian and Philippine waters. Whether it is only one hour or several, it should be discussed and agreed upon during Wednesday’s forum,” said defense expert Kusnanto Anggoro, speaking to the Jakarta Post. Indonesia has led the call for the right to "hot pursuit" maritime boundary crossings. “Implementation of the agreement must be conducted as soon as possible due to the high intensity of threats, such as the hostage-taking of several Indonesians by militant groups,” said Indonesian Defense Minister Ryamizard Ryacudu following the meeting. The nations have not yet reached an agreement on whether the right to pursue suspects will extend onto land. Their three navies have already begun combined sea patrols. A designated security corridor for vessel traffic is also under discussion, which would help security forces focus their patrol efforts. Even if fully and successfully implemented, the agreement may not be enough to combat Abu Sayyaf kidnappings, says Zachary Abuza, PhD, a professor at the National War College. "Manila is unlikely to allow armed convoys from Malaysia or Indonesia to continue into Philippine waters," he wrote. "The weak link remains the limited capabilities of the Philippine Navy, Coast Guard, and law enforcement authorities. What little the Philippines actually has is primarily focused on their maritime claims in the South China Sea." http://maritime-executive.com/article/sulu-sea-joint-patrol-agreement-signed

Tsai Government Must Fix Errors. Bruce Jacobs, Taipei Times. “The administration of President Tsai Ing-wen (蔡英文) has implemented some important progressive measures. For example, in her apology to Taiwanese Aborigines on Monday, Tsai promised to deal with the nuclear waste on Orchid Island (Lanyu, 蘭嶼) and to recognize Pingpu peoples, including the Siraya, who have long requested official acknowledgement of their existence. Yet, the new government has also made some very bad mistakes. Here, I will comment on two, one in foreign relations and one in domestic matters. The response of the Presidential Office and the Ministry of Foreign Affairs with regard to the award of the Permanent Court of Arbitration in The Hague, the Netherlands, about the South China Sea only mentioned “Taiwan” once when the ministry quite correctly complained that the award used the term “Taiwan Authority of China.” However, the other 25 and more references in both documents were to the “Republic of China” or the ROC, not to Taiwan. What happened to the president who signed her name in Panama as “President of Taiwan?” Even though mention of the “nine-dash line” was omitted, the government’s claim remained the same. In the words of the Presidential Office statement: “The government of the Republic of China stresses that the ROC is entitled to all rights over the South China Sea Islands and their relevant waters in accordance with international law and the law of the sea.” To those of us who have studied the history of the South China Sea, this claim has always lacked any basis. Eliminating mention of the “nine-dash” line did not make Taiwan’s case any stronger. One result has been that the Taiwanese government has been closely associated with the Chinese claim, as both have used the same historical “facts.” In its analysis of responses to the international court’s ruling, Washington think tank the Center for Strategic and International Studies — where Tsai spoke during her presidential campaign — divided the responses of nations to the award into several categories. Only five nations opposed the ruling: China, Montenegro, Pakistan, Sudan and Taiwan. None of the other four has expressed any friendship for Taiwan and all are well-known dictatorships. What is Taiwan doing in this company? In addition, the government has consistently neglected to mention the one historical fact that could help Taiwan’s claim to Itu Aba Island (Taiping Island, 太平島) — that the Japanese colonial government in Taiwan administered Itu Aba as part of Kaohsiung. Taiwan today can claim it as the successor government to the Japanese colonial government of Taiwan and thereby has rights to Itu Aba. How should Taiwan have responded to the tribunal? First, it should have realized that the award’s declaring that no “islands” exist in the South China Sea did not affect Taiwan’s claim for Itu Aba since Taiwan has not tried to enforce a 200 nautical mile (370.4km) exclusive economic zone. Second, the government should have realized that the award actually strengthens Taiwan’s hand by stating that the waters of the South China Sea belong to all nations. The rejection of China’s claims over the area actually helps Taiwan’s strategic situation. The government should have said something like: “As a law-abiding and peace-loving nation, we welcome the award of the Hague Arbitral Tribunal and we look forward to cooperating with other nations of the region and the world in promoting freedom of navigation through these important waters.” In one sentence, Taipei could have put Taiwan on the “correct side” of both history and international relations. Instead, the government stupidly repeated the nonsense that we have heard from the Chinese Nationalist Party (KMT) for more than six decades. Domestically, the government has made a major mistake in its nomination of Public Functionary Disciplinary Sanction Commission Chief Commissioner Hsieh Wen-ting (謝文定) as Judicial Yuan president. Tsai’s administration has repeatedly stressed the importance of judicial reform, yet it has taken a prosecutor from the old dictatorship. I met Hsieh in 1980, as he was the prosecutor who charged me. According to an article published in the Chinese-language Liberty Times (the Taipei Times’ sister paper) on Saturday last week, Hsieh stated: “Bruce Jacobs could not possibly be the murderer.” (The Taipei Times also ran the story: “Interview: Judicial Yuan nominee defends his record,” Aug. 2, page 3). If that is the case, why did he issue a criminal subpoena in which I was listed as “the defendant” in the “murder” case? Why did he forbid me to leave Taiwan when I needed to teach at my university and take care of my young daughter? Furthermore, the extra three months in Taiwan cost me about US$6,500 to US$7,500 in expenses for a lawyer, international phone calls and laundry. Today, that would be considerably more and, with interest, the compensation would probably exceed US$100,000 since I was held in Taiwan against my will even though I was not guilty. How can a prosecutor impose a lot of pain and financial strain on a person he says was innocent? And, if I was not guilty, why was so much of Taiwanese taxpayers’ money wasted? One newspaper report said the amount the Criminal Investigation Bureau spent on me exceeded NT$300,000. In 1980, that was a huge amount of money. Instead of picking someone from the old dictatorial regime, why not nominate someone who criticized the old dictatorial judicial system and who is committed to reforming the judiciary? The appointment processes of the new government require an immediate renovation and transformation in both foreign relations and domestically. Otherwise, it will be difficult to distinguish the new government from the previous KMT governments and the new government will repeatedly fail.” http://www.taipeitimes.com/News/editorials/archives/2016/08/04/2003652398

How The US Misjudged The South China Sea, Part I. Xue Li and Xu Yanzhuo, The Diplomat. “Since President Barack Obama took office in 2008, his administration has made achievements in both domestic and foreign affairs. In terms of politics and diplomacy, he is committed to become a peaceful president through conducting smart power diplomacy, which so far has included promoting his vision of a world free of nuclear weapons; ending the war in Iraq; accelerating withdrawal of forces and the end of military mission in Afghanistan; restraining U.S. involvement in Libya and Syria; championing the Iran nuclear deal framework; and normalizing relations with Cuba. However, in contrast to his policy trends and preferences, which tend toward contracting U.S. strategic commitments overseas, the U.S. has conducted a strategic expansion in the Asia-Pacific, which is evidenced by its deep involvement in regional security issues. Unfortunately, with the country immersed in domestic concerns, the White House’s attention to regional affairs is limited. Coupled with a lack of staff who have a deep understanding of Asian culture, “hawks” and the military have come to dominate East Asian affairs in the past few years. As a result, U.S. security policy aimed at de-escalating conflicts and tensions has been ineffective and even counteractive, as reflected by the case of the South China Sea (SCS). The United States has made two misjudgments in its SCS policy under the Obama administration. First, it mistakenly assumes that China is seeking to take full control of the waters and to expel the U.S. presence in this area. And second, it falsely believed that U.S. is able to force China to clarify its SCS claims and further to give up the nine-dash line through a set of “combo punches.” To be frank, the “combo punches” have been effective to some extent, but whether in the expected way is doubtful. The truth is the United States has overreacted due to the two misjudgments mentioned above. This approach not only humiliates China, but also forces Beijing to counterattack. What’s worse, it further raised tensions and increased Sino-U.S. conflicts. It is really the Obama administration’s strategic goal to threaten peace and development in East Asia? In response to a rising China, Obama initiated the idea of a “G2” early in his presidency in 2009, yet Beijing was not prepared for this role and did not react to this idea. Later, the United States adopted its “rebalance to Asia” strategy due to the changing security situation in the Asia-Pacific. It conducted a series of measures to balance China in the western Pacific Ocean. In the north, it strengthened the U.S.-Japan-South Korea trilateral security and military cooperation using the excuse of North Korean threat; in the middle, it urged China and Taiwan to make big concession in the South and East China Seas, (particularly focusing its efforts on the Tsai administration in Taiwan); while in the south, it consolidated the U.S.-Australia alliance and increased the U.S. military presence in this region. Meanwhile, the U.S. strengthened military cooperation with ASEAN using the excuse of the SCS disputes. This cooperation includes U.S.ally, the Philippines, quasi-ally Singapore, partners Indonesia, Malaysia, and Brunei, and also its former rival, Vietnam. Some Chinese researchers hold that the United States is containing China, at least in the security aspect. However, I argue Washington is seeking to counterbalance China rather than contain it. After all, the U.S. has strengthened its cooperation with China in the economic, cultural, educational, and scientific fields. If Washington chose to contain China on security issue, this would effectively mean the U.S. is financing its rival, which is neither reasonable nor effective. As an experienced hegemon, it is unlikely that the United States would adopt such a contradictory strategy. Instead, it’s more likely that Washington believes that regional peace and stability rely on the balance of power, and it is the U.S. responsibility and interest to play the role of a balancer. Thus preventing and balancing a rising China and maintaining freedom of military navigation is a realistic choice for Washington. The U.S. considers China to be breaking the balance of power in the Asia-Pacific. On one hand, China’s recent growing assertiveness in the SCS has caused concerns in ASEAN, particularly among ASEAN claimants. They chose to side with the U.S. for security reasons. On the other hand, Washington itself felt its military activities in other countries’ EZZ and territorial waters were under threat. Once China’s expanding naval power gave it the capability to carry out anti-access and area denial, the United States would have to give up military activities in these waters, a situation which even the Soviet Union could not achieve during the Cold War. As a result, the U.S. increased its military support to ASEAN, especially ASEAN claimants, and meanwhile urged China to restrain itself and increase its military transparency in the SCS. When Washington found this approach to be ineffective, it changed course to conduct further measures. The SCS dispute has evolved into three-layers: the U.S. and China; China and ASEAN; as well as China and ASEAN claimants. Six parties are involved in the disputes over the sovereignty of these maritime features; while in terms of maritime delimitation, seven parties (including Indonesia) are involved. From the perspective of great power politics, the United States and China are major players; in contrast, ASEAN and the claimants are less significant and tend to follow the U.S. agenda. In this case, SCS is more of a political and strategic struggle than a legal and economic issue. That is the reason for the great power politics between U.S. and China in the SCS. From 2009 to 2013, U.S. has manipulated the SCS issue behind the scenes, (see, for example, its reaction to the Scarborough Shoal incident of 2012). Since the HD-981 oil rig incident in 2014, Washington changed its role to become a player, as shown when U.S. Defense Secretary Chuck Hagel openly criticized China in that year’s Shangri-La Dialogue. Later, the U.S. determined to fight with “combo punches” due to China’s large scale land reclamation. This “combo” includes taking full advantage of the Philippines’ arbitration case; emphasizing freedom of navigation operations (FONOPs) at every chance; inviting more countries to participate in joint patrols; and dialing up on the volume on international organizations’ (such as ASEAN, G7, and the EU) and big powers’ (like Japan and India) voices on the SCS disputes. These approaches aim to delegitimize the nine-dash line and China’s historical claims, to create a “donut” in the SCS — that is, narrowing maritime rights within 12 nautical miles or even 500 meters of occupied maritime features. This series of actions created a new reality and new rule, which the U.S. forced China to accept. Otherwise, China would have to pay dearly in international society, where China would be portrayed as a “bully” state that undermines peace and stability in the SCS, destroys natural resources and the environment; a lonely power who does not abide by international law. As an experienced hegemon, the U.S. has distinguished strategic planning capabilities. The “combo punches” mentioned above are very effective at pressing China on multiple fronts: international law and international public opinion; physical control of the waters; China-ASEAN cooperation and the progress of a code of conduct (CoC). The arbitration verdict was also harmful to China’s international image, efforts for peaceful rise, peripheral diplomacy and relations with ASEAN, as well as the new type of great power relations with United States. However, from China’s perspective, the U.S. is undoubtedly the driving force and major manipulator behind these negative consequences. What’s worse, the U.S. military is challenging the principle of civilian control of the military. Senior military officials continuously comment on the SCS, making remarks that should be delivered by diplomats. For instances, while not naming China, U.S. Pacific Fleet Commander Admiral Scott Swift said some countries were bucking international rules and creating chaos after more than 70 year of stability; Commander of Pacific Command Admiral Harry Harris accused Beijing of being responsible for the tensions in the SCS and hinted that the U.S. should be ready to go to war. The military’s top commanders in Pacific are lobbying the National Security Council for a more confrontational approach to China, like Harris’ advocacy for more muscular patrols and Japanese engagement. It recalls the days of General MacArthur. It’s widely known that the United States has not ratified UNCLOS; however, it accepted the Convention as a codification of customary international law and generally respected it. However, a U.S. B-52 flew within 2 nautical miles of Cuarteron Reef; the USS Curtis Wilbur destroyer sailed within 12 nm of Triton Island; and the USS William P. Lawrence travelled within 12 nm of Fiery Cross Reef. All these military activities violated not only China’s domestic law, but also international law. The United States explained its passage near Cuarteron Reef as a mistake. Yet as for the dangerous activities by the USS Curtis Wilbur, the Pentagon firstly claimed this was an example of “innocent passage”; later it renamed the operation as a demonstration of “freedom of navigation” and even argued this action was “consistent with international law” and a “routine operation.” Pentagon spokesperson Jeff Davis claimed that “this operation challenged attempts by the three claimants — China, Taiwan, and Vietnam — to restrict navigation rights and freedoms.” Similarly, Defense Department spokesperson Bill Urban said the navigation operation by the USS William P. Lawrence was to challenge “excessive maritime claims are inconsistent with international law as reflected in the Law of the Sea Convention in that they purport to restrict the navigation rights that the US and all states are entitled to exercise.” Here, it’s worth mentioning an episode from 2015. On November 13, Representative Nancy Pelosi and her congressional delegation had lunch with several Chinese scholars. During the meeting, she noted that Chinese naval fleet traveled through the Strait of Tanaga when Obama was in Alaska. Pelosi was quite concerned about the patrol. So how to explain why the U.S. sent the USS Lassen to within 12 nm of Subi Reef during China’s fifth plenum in October 2015? If, as per Pelosi, China’s transit near Alaska was aggressive due to Obama’s presence in the state, the timing of the USS Lassen’s operation was much more provocative. What’s more, which article of international law says FONOPs should be carried out according to the interpretation of the travelling state? FONOPs within 12 nm of a feature can only be conducted according to either innocent passage or transit passage. When it comes to innocent passage, the state in control of the territorial sea can choose to require non-notification, notification in advance, or approval in advance. China, as the controlling state of the features in question, requires approval in advance. It is reported the U.S. warships operate in accordance with China’s domestic law within 12 nm of China’s coastal line, but apparently deliberately chose not to do so in the SCS. In this regard, the so called FONOPs by USS William P. Lawrence and Curtis Wilbur not only misinterpreted international law, but also intentionally violated China’s domestic law and deliberately humiliated China. Defense Secretary Ash Carter visited the USS Stennis in the SCS this April. Compared with his trip to the waters near Malaysia last year, this trip was more provocative and contemptuous. The message it sent to China was: “I’ve come back again; what can you do about it? Do you have the capability to patrol in U.S. waters?” Afterwards, the U.S. request for a port visit to Hong Kong was inevitably refused by the Chinese government. It is quite interesting that the U.S. expected such a privilege after humiliating China. Reports suggest that the U.S. military plans to conduct two FONOPs in the SCS every quarter. The USS William P. Lawrence’s patrol on May 10 within 12 nm of Fiery Cross Reef should be counted as the first operation. In response, China “monitored, followed and issued warnings to the U.S. vessel,” according to the Foreign Ministry. A patrol near Scarborough Shoal or Mischief Reef is likely to be the second operation in this quarter. Washington’s think tanks and media have hyped the idea that China is going to build an outpost on Scarborough Shoal, a land reclamation operation much larger than other Chinese projects in the Spratlys. The U.S. military is preparing for this operation by flying over Scarborough Shoal. From the U.S. perspective, this operation is a kind of warning; in China’s view, it is both a threat and humiliation. In the eyes of most other countries, FONOPs, introduced in 1979, serve as a tool for the United States to expand its maritime interests based on its naval force and legitimize its unreasonable claims. Obama, commander-in-chief of the U.S. military, is not an aggressive president. He reportedly refused some proposed FONOPs, yet approved a few of the operations when lobbied by the military. The consequences and effectiveness of these operations are questionable. The fact is since October 2015 the muscular actions continuously provoked and humiliated China and forced China to react. The patrol may please those who want to see an expanded military budget; however, it deeply hurts the Sino-U.S. relationship, increases the tensions in the SCS and hinders more realistic solutions (like the negotiation of a CoC). In part, these counterproductive U.S. actions are driven by a misunderstanding of Chinese actions and goals in the SCS. Part II of this piece, coming tomorrow, will examine China’s stance in the SCS and its response to U.S. actions.” http://thediplomat.com/2016/08/how-the-us-misjudged-the-south-china-sea-part-i/

China Supports Trump, Loses American Electorate. Gordon Chang, Cipher Brief. ““Who is Trump?” asks a Chinese official close to the country’s military. “We don’t really know.” China’s leaders are perplexed by the Republican candidate for president, and they look, depending on the moment, angered, fascinated, or terrified. Yet even though Donald Trump incessantly vilifies China, state media comments suggest the leadership in Beijing favors him over Democratic opponent Hillary Clinton. Why? In short, China’s leaders dislike Clinton intensely—it even looks personal—and apparently think they can buy or otherwise defang Trump. There is almost nothing Chinese leaders like about the Democratic nominee. “Hillary is very fierce when it comes to China,” said the official with the military ties. In contrast to Hillary Rodham Clinton, Donald John Trump must look like a godsend to Beijing. For one thing, the Chinese think he might give them nothing short of a once-in-a-century opportunity. The candidate who speaks of withdrawing from the World Trade Organization and the North Atlantic Treaty Organization, as well as breaking the North American Free Trade Agreement and decades-old bilateral alliances, can dismantle the global architecture put in place after the Second World War and isolate the United States for decades. Therefore, the Chinese can see East Asia, free of Uncle Sam, as theirs to dominate. “The thought of a collapse of the U.S. alliances with Japan and South Korea and, in effect, the withdrawal of the United States from Asia is Xi Jinping’s dream come true,” William Stanton, the director of the Center for Asia Policy of Taiwan’s National Tsing Hwa University, told The Cipher Brief. And Stanton, also Washington’s representative in Taiwan from 2009 to 2012, thinks Beijing anticipates icing on the cake: President Trump would stop hectoring Chinese leaders about human rights, criticism that bothers them to no end. In the Republican candidate, therefore, Beijing believes it has someone it can work with. “Trump would be the world leader closest in personality to top Chinese Communist officials,” says Robert Blohm to The Cipher Brief. “They’ll probably grow to like each other.” After all, there is an uncanny resemblance of Xi Jinping’s “great rejuvenation of the Chinese nation” and Trump’s “Make America Great Again.” As Blohm, just back from a decade serving as an economic policy advisor in Beijing, perceptively notes, the two share the politics of resentment. The Chinese may not even be that concerned about The Donald’s bold promises to crack down on trade with their country. “Beijing sees Trump as nothing more than a businessman, and the Chinese are masterful business people, who have run circles around their American counterparts ever since Deng Xiaoping opened China,” notes Stanton. Trump, however, might run some circles of his own. The Chinese have prospered, especially since their accession to the World Trade Organization (WTO) at the end of 2001, because they were able to get the protections of the global trading body while for the most part avoiding costs for increasingly predatory trade behavior. Yet from the very start of his campaign, Trump has promised to stop China from taking advantage of the American worker. So Beijing’s gaming of trade rules looks set to end in a Trump administration, especially if he takes America out of the WTO. Trump, more than Clinton, can disrupt the steady flow of Chinese-made goods into the American market. His proposed 45 percent tariff along with his other drastic measures can injure America, but they can take down weak economies in the process. Think of him as a modern-day Samson, disrupting the global economy and collapsing a fragile China. And China is especially vulnerable at the moment. Its debt-laden economy is slowing fast, growing at perhaps a third of the reported 6.7 percent pace and heading for a contraction. The country’s trade, long the driver of growth, is faltering. Chinese exports for 2015 fell 2.8 percent. For the first six months of this year, they plummeted a stunning 7.7 percent. But as bad as those numbers are, Trump can make them worse because China is dependent on the American market. Last year, China ran up a record merchandise trade surplus against the U.S. of $367.2 billion, and this year that surplus is growing at about the same pace as last, $131.3 billion through the first five months. He has made it clear that the U.S. will no longer tolerate these outsized trade deficits. Trump, whether he intends to or not, can push a trade-dependent China over the edge. The real problem for Beijing, however, is neither Mr. Trump nor Secretary Clinton. As a matter of domestic political imperative, either of them as president will have to respond to Beijing in ways that will be fundamentally injurious to China’s interests. American public opinion now cannot be ignored, whether the issue at hand is economic, political, or geopolitical. So the Chinese, in a sense, should spend less time thinking about which of the two candidates will be better for them and more about the pressures to which those candidates will have to respond. Beijing has lost the American electorate, and that is what ultimately counts.” https://www.thecipherbrief.com/article/asia/china-supports-trump-loses-american-electorate-1090

Xi’s China: Command And Control. Charles Clover, Financial Times. “When Xi Jinping arrived in camouflage fatigues for a visit to the Chinese military’s new joint command centre in April, the president was sending a message to the political elite. Previous Chinese leaders had always worn a green Mao suit on such visits to the People’s Liberation Army, observing a sartorial separation between the military and civilian roles of the Communist party. Wearing fatigues was something new, heralding a different attitude to the PLA under Mr Xi, who has made the military central to his presidency and the main pillar of his personal authority. “Xi was breaking that tradition on purpose,” says Dennis Wilder, former CIA deputy assistant director for East Asia and an expert on the PLA who now teaches at Georgetown University. “He was saying not only do I represent the party, but I’m one of you.” In the nationally televised event, the president chatted with officers in the Beijing facility, gazing at screens of real- time operational data. Tai Ming Cheung, a specialist on China’s military at the University of California, San Diego, says the broadcast showed “a level of engagement with the military at an operational level, a hands-on approach that is not characteristic of recent Chinese leaders”. The announcer also revealed that Mr Xi had a new rank, referring to him as the PLA’s “commander-in-chief” of joint operations, a title last used in 1949-54 by Zhu De, the revolutionary general under Mao Zedong. While a formality — Mr Xi already chairs the Central Military Commission, giving him supreme power over the PLA — it reinforces his symbolic authority with a military rank in addition to a party one. The Chinese president is not the first politician to use rank and uniforms to buttress his image as a strong leader, but the pageantry, taken together with other episodes such as a huge military parade last September, appear designed to identify Mr Xi with the military in a way not seen since Mao or Deng Xiaoping led the country. “Even Mao wasn’t commander-in-chief. This is a whole new thing,” says Christopher Johnson, an expert on Chinese politics at the Washington DC-based Center for Strategic and International Studies. More importantly, Mr Xi was using the visit to drive home his victory in a battle to reform the PLA, observers say. An often brutal process, it has led to the purging of hundreds of senior officers over the past two years — part of the broader Xi anti-corruption campaign — and will see troop levels cut by almost 300,000. The opening of the joint command centre showcased the sophisticated technology but it also heralded a new order. It broadcast the moment when the dominance of the ground forces in the PLA ended, and the elevation of its navy, air force and strategic rocket divisions began as they prepare to fight 21st century battles. The corruption purge had the side effect of “softening up” the PLA, in the words of one analyst, for a reform that would rip it apart and put it back together under Mr Xi’s direct command. “Breaking political factionalism within the PLA has been one of the major goals of the anti-corruption campaign,” says Liu Bojian, a researcher at the East Asian Institute, of the National University of Singapore. He says the purge of senior ranks has so far felled at least 37 major generals, all of whom have been tried. The reforms, seen as the most pervasive since the revolution of 1949, involve the rewiring of the PLA’s reporting structure, placing it under Mr Xi’s personal command and stripping some of its power. The purges have been aimed at reinforcing his authority by weeding out opponents. By confronting vested interests in the military Mr Xi is taking a gamble as great as any leader over the past four decades. It was Mao who declared political power “comes from the barrel of a gun” and since his death few have dared to interfere in the tense PLA-Communist party ties that form the bedrock of the state. Over the past 40 years, however, the PLA has developed a reputation for factionalism, corruption and thumbing its nose at its political masters. Previous leaders have tolerated this behaviour but Mr Xi evidently sees it as one of the priorities for change. “Relations with the PLA is always something the leader has to figure out,” says Mr Wilder, who uses the term “conditional compliance” to describe PLA-party relations. “It is something they have to be very careful with — the PLA is the real source of the party’s power.” While officially subordinate to the party, Mr Wilder says the PLA “in truth is only ever subordinate to one party official, the chairman of the CMC [Mr Xi]. His relationship with the PLA sets the tone for the entire political system right now.” Vasily Kashin, a specialist on China’s military at the Higher School of Economics in Moscow, puts it more bluntly: “Xi is transforming the PLA into a political power base.” The delicate balance between the PLA and the party is being revised at a critical moment — as the US and China square off in the South China Sea. Following an arbitration court’s decision against China’s claims in the area this month, the PLA held a series of massive military and naval manoeuvres to remind rivals that it does not accept the court’s judgment. Some western analysts say they worry that the PLA may be lobbying for a more confrontational approach as a way to gain domestic political leverage. “The PLA’s political clout has taken a severe hit in the face of a comprehensive retooling of its force structure and Xi’s anti-graft crackdown,” says Mr Johnson. “The noises they are making suggest they may be looking to the South China Sea for redemption.” The purpose of the reforms is to have a military capable of challenging the US — meeting or surpassing it in technological and operational capabilities by 2030. It will not be easy: Washington still spends three times China’s estimated $200bn annual defence budget, despite double-digit increases in percentage terms nearly every year for the past quarter of a century. The PLA, meanwhile, is notoriously low tech. It fought its most recent war, a disastrous 1979 border conflict with Vietnam, wearing sandals and soft hats, and using signal flags for battlefield communications. And while a new generation of high-tech weapons such as aircraft carriers, nuclear submarines and stealth fighters are rolling out of factories, experts say it will be years if not decades before China is capable of using them effectively. Experts say they doubt the PLA’s current capability to win a war against even a smaller regional opponent like Japan, let alone the US, and that the political consequences of such a loss could be catastrophic: “If you lose a war to Japan it’s game over for the CCP [Chinese Communist party],” says Mr Johnson. The PLA began life in the 1920s as a peasant guerrilla army, which became one of the two pillars of the state after it defeated nationalist forces in the 1949 civil war to bring the Communist party to power. Following the chaos of the Cultural revolution in the 1960s the PLA emerged as one of China’s few functioning institutions. Having expanded to an estimated 7m people, the army had become a state within a state. Following Mao’s death, Deng sought to do something about its power and cut troop numbers by 1m. “Xi saw how Deng put the PLA in its place after the Vietnam campaign,” says Mr Wilder. “Now Xi is using the same playbook: you knock them on the head, say ‘you’re no good, you’re corrupt, but its OK because I’ll fix you’,” he says. Another motivating factor for Mr Xi was the relationship his predecessor, Hu Jintao, had with the PLA. The defining moment came in January 2011 when the air force conducted the first test flight of its homegrown stealth fighter at the same time that Robert Gates, the then US defence secretary, headed into a meeting with Mr Hu in Beijing. Mr Gates said later that he believed Mr Hu had been surprised by the test and humiliated in front of his foreign guest. “Over the last several years we have seen some signs of . . . a disconnect between the military and the civilian leadership,” Mr Gates said at the time. “Xi’s view of the military would have been conditioned by witnessing first hand the problems of Hu’s relationship with the military during the time that Xi was being groomed for leadership,” says Mr Cheung of San Diego University. Within months of coming to power Mr Xi struck the first blow, announcing in November 2013 long-term troop cuts and deep structural reforms. He has effectively dismantled four major departments: logistics, the general staff, the political works unit and the one responsible for armaments — the pillars of the PLA since its creation. They still exist but their influence has been dramatically diluted. “The Communists trace their lineage to this organisation created during the civil war, and these departments are all two decades older than the People’s Republic of China itself,” says Mr Kashin of Moscow’s Higher Economic School. “Now they are effectively dismantling them. That is a huge move.” The overall impact has been to fundamentally change the nature of power in the military. All departments are now directly under the control of the CMC headed by Mr Xi, rather than the army led general staff. They share power with 11 agencies — some newly created, others reconfigured — but all under the commission’s direct administration. In parallel the anti-corruption purge led to the arrest of a number of senior officers including General Xu Caihou, former head of the army’s political department, and General Guo Boxiong, a senior military figure and former vice-chairman of the CMC, who were both accused of taking bribes in exchange for promotions. Xu died of cancer before he could be imprisoned, while Guo was this week sentenced to life in prison. Ni Lexiong, a naval expert at the Shanghai University of Political Science and Law, says behind the scenes resistance continues from within and outside the military. “This is often the case with reforms — it will be met with friction from within from backward forces,” he says, jokingly using the Marxist term for counter-revolutionaries. While some in the military support the reforms — especially younger officers tired of corruption — the overhaul has met opposition. A number of articles published in the military press over the past year have called for loyalty to the party — something that would not be needed if the authorities were confident they had that support, say observers. The resistance is most pronounced in the ground forces, historically the dominant arm of the PLA. They now have the most to lose as the shift towards the navy, air force and strategic rocket forces gathers pace. “If you wear green you don’t like this reform,” says Mr Johnson at the Center for Strategic and International Studies. The other overriding factor will be the economic impact of the restructuring of the armed forces, Mr Ni adds. More than anything, the regime fears social unrest and the Xi administration will have to balance laying off 300,000 people at a time when the economy is sputtering and some industries are already cutting thousands of jobs. “Local governments have to deal with the pressure of arranging jobs for the recent retirees,” says Mr Ni. “They may have to introduce new openings to an already saturated system.” The reforms are unlikely to make China’s neighbours sleep any easier — with fears of a looming confrontation in the South and East China Seas. Beijing’s headlong pursuit of a better military “certainly sends a signal to the rest of the region”, according to a diplomat from a neighbouring country. Due largely to simmering tensions between China and its neighbours, military spending has shot up. In the Asia and Oceana regions, defence spending in 2015 rose the fastest in the world, by 5.4 per cent, according to a study by the Stockholm International Peace Research Institute. That beats even the oil-fuelled defence budgets of the war-torn Middle East. The question now is what Mr Xi plans to do with his newly remodelled, modernised but untested fighting machine. Yanmei Xie of the International Crisis Group in Beijing says Mr Xi’s hardline image and attention to the military is swinging the country towards nationalism. “There is this belief that Xi is nationalist, that he wants to project an assertive hardline image, and so officials and bureaucrats down the line are calibrating their rhetoric and behaviour accordingly,” she says.” https://next.ft.com/content/dde0af68-4db2-11e6-88c5-db83e98a590a

China Reins In Communist Youth League, And Its Alumni’s Prospects. Chris Buckley, The New York Times. “President Xi Jinping of China in effect wrote an epitaph to the shrunken influence of his predecessor and former rivals this week when the Communist Party announced major changes to its once-powerful Youth League, a training ground for many officials who have been marginalized under Mr. Xi. The Communist Youth League served as a cradle for generations of Chinese leaders, who rose through it into the high ranks of the party. Mr. Xi’s predecessor as China’s top leader, Hu Jintao, was among the most prominent. Others have included Premier Li Keqiang, Vice President Li Yuanchao and Ling Jihua, the former head of the party’s general office. But a reorganization of the Communist Youth League laid out in the state news media on Tuesday indicated that its glory days as a finishing school for China’s political elite may have passed. The overhaul promised to shrink the Youth League’s central leadership, put it under firmer party control and return it to its grass roots to try to win over the country’s young people. “Its ranks will undergo shrinkage at the top and replenishment below,” an unnamed Youth League leader said in People’s Daily, the party’s main newspaper, on Wednesday, explaining the reorganization. “In the face of major changes in the social environment and youth population, there are many areas of the Youth League’s development and work that are ill-adapted or unsuitable.” The prominence of Youth League experience in the résumés of many party officials has led some analysts to refer to a Youth League faction or clique, a coalition of cadres who came up through the organization, owed their loyalty to it and each other, and shared a political agenda that was vaguely populist. But officials who emerged from the Youth League were never as cohesive as some assumed, and the circumstances that made the league an incubator of political talent had diminished before Mr. Xi took power in late 2012, said Li Datong, a former editor at China Youth Daily, the league’s newspaper. The latest changes made it clear that this group had little influence, he said in an interview. “Under Hu Jintao you could maybe make a strained argument that there was some kind of Youth League faction, but not now,” Mr. Li said. “It’s ceased to exist.” “The criticisms of the Youth League show that its influence has run its course,” he said. “It’s become a political zombie.” The announced changes indicated that the Youth League’s alumni are unlikely to win many promotions into the topmost ranks when Mr. Xi and other leaders settle on a new national leadership lineup to be revealed late next year, said Bo Zhiyue, a professor of political science at Victoria University of Wellington, New Zealand, who studies elite Chinese politics. “The fact that they’re conducting these serious reforms is trying to undermine the legitimacy of the Youth League as a supply pool of future leaders,” Professor Bo said by telephone. “It’s an implicit attack on the power base of the so-called Youth League faction.” Before the changes were announced, the league had been stained by corruption and criticisms that it had fallen out of touch with the youthful idealism it was supposed to inspire. The Youth League traces its inception to the formation of the Chinese Communist Party in the early 1920s, to serve as a bridge to students, young workers and other potential inductees into the Communist revolution. By the end of last year, it had 87.5 million members, many of them university students who hope to eventually join the party. The maximum age is about 28 for ordinary members, although officials in the league can be much older. The Youth League won particular prominence as an incubator for future leaders in the 1980s. That was partly because the party leader for much of that decade, Hu Yaobang, was a former Youth League leader. Perhaps more important, the party also faced a talent gap at the time. In the late 1970s, after the Cultural Revolution and its radical supporters were swept away, party veterans such as Deng Xiaoping returned to power. But they knew that age would soon catch up with them and made plans to nurture potential successors. The Youth League became an important training ground for that, Professor Bo said. The high tide of its prominence came under Mr. Hu, formerly the first secretary of the league, who was handpicked by Deng to be China’s top leader. Party insiders said that Mr. Hu, in turn, favored Li Keqiang, another former head of the league, to succeed him as president and party general secretary. But instead, Mr. Xi won those posts, and Mr. Li took the more junior job of premier. Since Mr. Xi came to power, he has assumed more influence than his recent predecessors. Meanwhile, officials who spent long parts of their careers in the league have languished. Mr. Li has been less powerful than his predecessors. Li Yuanchao, the vice president, has become an ornamental figure, shadowed by anticorruption investigations that have felled former subordinates. Most spectacularly, Mr. Ling, the former head of the party’s general office, was expelled from his posts in July last year after being charged with corruption. He appeared to have had hopes for promotion into the top echelons until March 2012, when his son fatally crashed a Ferrari Spider. Two young women were also injured, one of whom later died. Last month, Mr. Ling was convicted of taking bribes, abusing his office and illegally obtaining state secrets and was sentenced to life in prison. Mr. Hu, the former president, has remained quiet in retirement, giving no signs that he has the will or the influence to shape politics, even when his former protégés have fallen. Months before the changes to the Youth League were announced, the party’s discipline enforcement agency issued a long, unusually scathing account of problems in the organization, including an aloof leadership. In response, league leaders promised in April to “aggressively erase ‘aristocratic’ tendencies.” The Youth League may still help to identify and nurture future party leaders, but they will have to demonstrate more hands-on experience than previous league alumni who rose up, Professor Bo said. “One of the criticisms of this organization has been that you spend too much time sitting in an office trying to get yourself promoted without any actual practical experience,” he said.” http://www.nytimes.com/2016/08/04/world/asia/china-communist-youth-league.html?ref=world&_r=0

Philippines Warns Fishermen To Steer Clear Of Disputed South China Sea. AFP. “Manila: The Philippines told its fishermen on Wednesday to steer clear of a fishing ground in the disputed South China Sea to avoid harassment from Chinese authorities. The warning came despite a recent ruling by a UN-backed tribunal in favour of the Philippines, as it dismissed China's territorial claims to large swathes of the waters. Beijing angrily rejected the court's judgement and on Wednesday it announced penalties for "illegal" fishing in its waters including the disputed areas. "We are aware that China is occupying Scarborough Shoal, so let us wait for clarity on how our fishermen can return there without being subjected to harassment anymore," Manila's foreign affairs spokesman Charles Jose told reporters. Jose said that while the tribunal ruling was clear, the "reality on the ground" was different. "The reality is that China is there so we must discuss this," he said. Asked if this meant Filipino fishermen should avoid the shoal for now, Jose said: "This is for the safety of everyone." Manila's position is likely to anger critics of President Rodrigo Duterte's new government, which has been accused of taking a soft line with Beijing. The question of who has the right to fish in the disputed South China Sea has been a major bone of contention between Beijing and Manila, which brought the case to the Permanent Court of Arbitration in The Hague. Manila lodged the case under its previous government in 2013, saying that after 17 years of negotiations with Beijing it had exhausted all political and diplomatic avenues to settle the dispute. Vietnam, Malaysia, Brunei and Taiwan also have claims to the sea, through which over USD five trillion in annual trade passes. In 2012 China took control of the Scarborough Shoal, 230 kilometres from the main Philippine island of Luzon after a stand-off with the country's navy. It has since driven away Filipino fishermen attempting to fish in the area, sometimes using water cannons. Duterte has said he wants to repair relations with China that were battered during the term of his predecessor Benigno Aquino. Duterte, who assumed the presidency on 30 June, said he would send former president Fidel Ramos to Beijing as an envoy to negotiate on the issue. "This is one of the priority issues that we must take up when we go into direct talks with China," Jose said on Wednesday.” http://www.firstpost.com/world/philippines-warns-fishermen-to-steer-clear-of-disputed-south-china-sea-2932132.html

Indonesia Says No Dispute With Beijing In South China Sea. Saifulbahri Ismail, Channel News Asia. “Indonesia will not change its position on the South China Sea, maintaining that it does not intend to become a claimant state in the disputed territory. At a forum on Tuesday (Aug 2), an Indonesian senior government official denied the country had any dispute with Beijing. Jakarta is also upholding its position as a non-claimant state in the South China Sea. “We’re not claiming any islands so we’re not a claimant state. If we want to become a claimant, then we need to declare which islands we need to claim,” said Indonesia's Deputy Coordinating Minister of Maritime Affairs and Resources Arif Havas Oegroseno. But Indonesian President Joko Widodo is facing a growing call to abandon this neutral stance. He visited the Natuna islands in June to send a strong and clear message to China that the country is serious about protecting its sovereignty. His visit came on the back of clashes between Indonesia's navy and Chinese vessels in the resource-rich Natuna waters, which China maintains are its traditional fishing grounds. Analysts said the continued presence of Chinese fishing vessels in Natuna waters reveals the limits of Jakarta's non-claimant position. Some also suggest that China's presence in those waters is its way of laying claim to the area. Such actions have caused confusion. Professor Hasyim Djalal, an expert in International Maritime Law, said: “Does China really want us to be a claimant, or be a party to the dispute? So far, we do not consider ourselves as a party. China kept telling us ‘we have no problem with you’ … and therefore it is enigmatic to me why these kind of incidents happened.” Indonesia has since sent hundreds of fishing vessels to Natuna to exert its sovereignty. It is believed that these boats will also act as surveillance, helping to alert authorities against any foreign vessels entering Indonesian territory. “The case in Natuna islands since March has made the Indonesian government understand that the question of the South China Sea and its surrounding waters is very important, and Indonesia needs to strengthen its presence in our outer islands in Natuna,” said Phillips Vermonte, executive director of the Centre for Strategic and International Studies. “That’s why we hear that the Indonesian government is trying to increase its presence.” In June, after the latest skirmish with the Chinese vessels, Indonesia set up a special task force to find a peaceful solution to the Natuna waters issue. The team is said to comprise international maritime law experts, headed by Prof Hasyim. However, Prof Hasyim said he has not been given instructions yet on what the team is supposed to do.” http://www.channelnewsasia.com/news/asiapacific/indonesia-says-no-dispute/3007476.html

Despite Pact With U.S., China Continues To Steal Intellectual Property. Bradley Barth, SC Magazine. “A new report released today from the Institute for Critical Infrastructure Technology (ICIT) warns that China's five-year plan for the years 2016-2020 is heavily reliant upon the digital theft of Western nations' intellectual property, despite the 2015 Sino-U.S. pact to eliminate cyberattacks against corporate assets. Entitled China's Espionage Dynasty: Economic Death by a Thousand Cuts, the paper looks to paint a comprehensive portrait of China's cyberspy program through the aggregation of reports from the U.S. government, cybersecurity firms and independent sources. The ICIT will present its findings in Washington D.C. on July 28 before an audience of federal agencies and critical infrastructure private-sector organizations. In September 2015, the U.S. and China publicly agreed not to digitally spy on each other for commercial gain. “While it is possible that China has reduced its targeted attacks against American organizations, it seems more likely that it restructured its cyber operations to assert greater control over its operatives,” the report concludes. In other words, the report states, China may have reined in its most obvious threats, while continuing to infiltrate Western businesses with more advanced, virtually undetectable advanced persistent threat (APT) attacks. “I think that the only part of Chinese hacking that has slowed down are the independent patriot script kiddies,” said author Scott, a senior fellow at the ICIT, in an interview with SCMagazine.com. “I believe that since that ‘agreement,' the Chinese have moved forward with a more targeted attack model and have replaced much of the 'smash and grab' hacking they are known for, with an attempt to be more covert and stealthy.” The paper claims that China's ongoing APTs are designed to help the country achieve the objectives of its latest five-year plan, which places a heavy emphasis on “cutting-edge technology and socioeconomic reform.” It then goes on to profile 15 known state-sponsored Chinese APT groups that allegedly steal intellectual property and spy on various Western organizations in order to stay economically competitive. In another section that could prove controversial, the report's authors issued a warning about Chinese Student and Scholar Associations (CSSAs) – organizations that help Chinese students studying abroad to acclimate to Western university life. The report contended that at least some these organizations are acting on behalf of the Chinese government by asking often unwitting students to report details of their research, which can later serve as actionable intelligence.” http://www.scmagazine.com/icit-report-despite-pact-with-us-china-continues-to-steal-intellectual-property/article/508767/

Why U.S. Tech Companies Can’t Figure Out China. David Pierson, The New York Times. “Uber’s abrupt decision to sell its China operations to chief rival Didi Chuxing on Monday adds to a growing list of U.S. technology firms that have failed to flourish in the world’s second-largest economy. The list, which reads like a corporate all-star team, includes Google, EBay, Amazon.com and Facebook. Each company set out to seize on China’s breathtaking size and potential. Each has been disappointed. What makes China such a challenging market for so many U.S. tech stalwarts? For one, it operates like an alternate Internet universe with established homegrown versions of Google (Baidu), Twitter (Sina Weibo) and YouTube (Youku Tudou). Many Chinese firms can innovate safe in the knowledge they don’t have to face foreign competition thanks to government bans on popular platforms such as Twitter, Facebook and YouTube. For the foreign companies that do make it in, they are often pitted against local companies as the non-Chinese option — no small detail against a backdrop of heightening nationalism. Just last month, Chinese Internet users were posting pictures of their smashed iPhones to protest Washington’s objections to Beijing’s territorial claims in the South China Sea. And that was for Apple, considered the most successful foreign tech brand in China. “There’s a home-field advantage,” said Arthur Dong, a professor at Georgetown’s McDonough School of Business. “Whether it’s state function of government policy or a less formal policy, foreign companies are at a great disadvantage.” That’s in line with Beijing’s desire to cultivate so-called national champions, large domestic companies hoped to one day become China’s most recognizable multinational brands. The goal is to wean the country’s now slowing economy off exports and infrastructure investment and ensure that the most lucrative opportunities go to Chinese firms. “Since President Xi Jinping took office, they have increasingly switched from an economic strategy that emphasizes attracting foreign direct investment to one that favors indigenous innovation and Chinese-owned firms,” said Robert Atkinson, president of the Information Technology and Innovation Foundation. One of the easier places to do this is on the Internet, Atkinson said, because it doesn’t require the cutting-edge technology or knowhow of, say, the aerospace or automotive sectors. And China’s Internet market is so big that it offers an ideal environment for massive Chinese firms such as Tencent, owner of WeChat, to establish itself before going global. At 668 million, the number of Internet users in China outnumbers the U.S. population by 2 to 1 — with plenty more room to grow. That size, experts say, means it’s very difficult for a foreign firm to come in and dominate. Take Groupon, the group buying e-commerce site, which launched in China to great fanfare in 2011 only to discover that it was up against 200 clones of its service. Within months, Groupon closed its offices in China. The case underscores how often U.S. companies are unprepared for the differences in China. EBay, for example, was undone by Alibaba’s Taobao, which offered free listings and appealed to Chinese users with little details like naming moderators after characters from famous kung fu novels. The lesson: A premium service doesn’t always make sense in an emerging market. For Uber, the challenge was keeping up with a bigger and scrappier competitor in Didi. The San Francisco ride-hailing giant was losing $1 billion a year fighting a local rival that served more cities and was agnostic about what set of wheels its drivers chose to use, be it a taxi, a car or a bus. The battle wasn’t going to get easier for Uber, which was the second-most-popular ride-hailing service in China with about 8% market share compared with Didi’s 85%. That’s because in making ride-hailing legal last week, the Chinese government also stipulated an end to subsidies that made rides artificially cheap for the sake of grabbing more customers. Without subsidies, Uber’s chances of unseating Didi were daunting at best. “I don’t know if that’s clear evidence the government has its thumb on the scale again, but you’ve got to think it hurts Uber more than it does Didi,” said Atkinson of the Information Technology and Innovation Foundation. The odds were also stacked against Google after it ran afoul of the Chinese government and pulled out its China operations in 2010. The search giant said it left because of censorship and because it was the target of cyberattacks in the country. But analysts say Google didn’t just lose to Baidu because of government meddling. The U.S. company could never overcome the perception that Baidu was made for a Chinese audience and Google for a foreign one. It took years for Google to realize that many Chinese couldn’t pronounce its name. The company ultimately had to rebrand itself GuGe in China. Even then, many people still chose to call it GoGo. Given the abject failures of most U.S. tech companies in China, Uber’s deal with Didi doesn’t look bad to some observers. Uber, after all, isn’t leaving China, and it still has a sizable stake in the growing ride-hailing space — not that the bar was particularly high. Microsoft, for instance, isn’t giving up on China even though at one point an estimated 95% of all copies of its Microsoft Office in the country were pirated. “They’re the first international Internet company that didn’t lose,” William Bao Bean, a Shanghai-based partner at SOS Ventures and the managing director of Chinaccelerator, said of Uber. “They fought to a draw. And for an American Internet company, that’s as good as a win.” http://www.latimes.com/business/technology/la-fi-china-american-tech-20160801-snap-story.html

South China Sea: It's Not Just About The Rocks, It's Also About The Fish. Wallace Gregson, The National Interest. “The South China Sea remains politically roiled. It has been almost a month since the UN Tribunal’s announcement. Chinese rhetoric attacks both court and verdict, military demonstrations continue and ASEAN’s foreign ministers issued a decidedly equivocal statement following their meeting. Secretary of State John Kerry’s request for a reference to the decision of the UN’s Permanent Court of Arbitration failed. China’s diplomatic efforts to moot the verdict, and by extension moot the UN Convention on the Law of the Sea (UNCLOS), achieved an early success. This dispute now enters a new—and not especially encouraging—phase. China’s nationalist ambitions mandate the recovery of lost territory, specifically including islands, rocks and low-tide elevations deemed—by China—to be Chinese from ancient times. The July 12 judgment by the UN Tribunal was a stunning rebuke to this goal. All nations on the East and South China Sea littoral and the United States are directly affected. But the stakes of the affected nations vary widely, as do capabilities and vulnerabilities. Standing alone there is little hope that the nations of the region can come to an acceptable, viable and enduring solution. The gaps among various national interests, stakes and capabilities must somehow be bridged. The United States seeks to fly, sail and operate our forces wherever international law allows, and peaceful settlement of disputes. Japan is tied to the United States by virtue of our strong alliance, a geography that defines the East China Sea, current issues there, Chinese air and sea territorial intrusions and China’s continued vilification. Directly opposed to this is China’s often stated “indisputable sovereignty over the islands in the South China Sea and the adjacent waters, and . . . sovereign rights and jurisdiction over the relevant waters as well as the seabed and subsoil thereof.” This is now part of their nationalistic narrative demanding reversal of past violations of Chinese sovereignty. Smaller nations along the South China Sea littoral, members of the Association of Southeast Asian Nations, are vitally concerned with free and secure access to traditional fishing areas in their territorial waters and exclusive economic zones. For most, fish is the major source of protein for growing populations. The smaller nations fear losing their major source of food. Potential oil and gas reserves, although unproven, add even more contention. Asia recalls well that resource competition leads to conflict. An effective international strategy to protect free and secure access for all requires some unifying principle or goal capable of gaining support from the ASEAN nations, others along the East and South China Sea littoral, the United States, Japan, international organizations and public opinion. Prevention of a catastrophic collapse of the East and South China Sea fisheries may be part of such a unifying principle. An effective strategy, carefully and skillfully coordinated and executed, can ensure that the recent court decisions become part of a trend. We must make it part of a “line” and not a discrete event, a “dot,” and thus quickly forgotten. July was a remarkable month. The court’s judgment was not the only disappointment for China. The Republic of Korea (ROK) agreed to the deployment of U.S. Theater High-Altitude Area Defense capability despite vigorous objections from China and North Korea. The ROK took this action in response to the most recent North Korean nuclear and missile tests. The ROK also closed the Kaesong Industrial Complex, one of the few and certainly the most significant instruments of cooperation between north and south. In response China threatened economic retaliation. In Korea, President Park promised government support to any Korean business damaged by Chinese punitive economic actions. On July 12, the UN’s Permanent Court of Arbitration (PCA) announced its unanimous decision in the case filed by The Philippines over two years ago. Included in the decision:

• The Nine Dash Line was rejected as a basis for South China Sea claims

• The court rejected the vast majority of Chinese claims and real-world behavior in the South China Sea

• China was found in violation of the rights of Philippine fishermen

• China was found to have “…caused devastating and long-lasting damage to the marine environment”. This included the mining of coral that experts deem will take centuries to recover, if ever.

• China was cited for providing armed protection for vessels engaged in illegal harvesting of marine life

The UN decision may provide a foundation for settlement of disputes and the development of South and East China Sea resources—fossil fuels and fish—or it may become just a step on the way to continued coercion, escalation and conflict. Most likely is continued struggle, at a higher level. Japan has aptly termed this “Grey Zone Conflict,” a competition involving military and naval forces, civilians, maritime auxiliary forces, law enforcement, coercive diplomacy and information. China already has de facto control over the South China Sea. Proximity brings many advantages. China’s extensive coastline, washed by both the East and the South China Seas, offers numerous ports and airfields supporting direct and immediate access of Chinese military, maritime auxiliary forces and fishing vessels to the seas. China’s massive investment in rockets and missiles distributed throughout their massive geographic sanctuary signals an intent to affect sea control and impose area denial from the land. Their pursuit of maneuvering ballistic missile warheads to attack large moving targets is another indicator of intentions. China’s vast fishing fleets, increasingly under state sponsorship and control, are always close to their support structure. These vast fishing fleets, in cooperation with Chinese Coast Guard and Maritime Auxiliary resources threaten to shoulder Vietnamese, Philippine and other nation’s fishermen out of their fishing areas. China’s South China Sea land building efforts demonstrate China’s ability and will to act as they wish in the South China Sea. Their new port and airfield outposts come at the cost of the destruction of vast coral reefs, the essential nursery of marine life, with as-yet uncalculated cost to sustainability of South China Sea and Pacific marine life. These new features testify to China’s ability to do what they please, their disregard for the welfare of others and their ability to exercise ever greater control. Support for military sea and air forces, maritime auxiliary and fishing fleets has now been extended well into the South China Sea and into the territorial seas of the other littoral states. China’s traditional fishing grounds are severely depleted or even collapsed. Fisheries in the South and East China Seas are under increasing pressure. Fishermen range far from their nearby seas in search of catch. In 2013 and 2014 encounters in Korean waters between Chinese fishermen and Korean Coast Guard forces resulted in the death of a Korean Guardsman and a Chinese fisherman in separate incidents. Without some respect for sustainable fishing practices we will see more deadly competition and ever more pressure on already damaged fish populations Experts predict major fisheries collapse in the area, leading to mass starvation. Professor John McManus of the National Center for Coral Reef Research at the University of Miami calls for an international protected zone similar to Antarctica. In his words, without this or some similar arrangement, “we are headed toward a major, major fisheries collapse . . . that will lead to mass starvation.” China moved much earlier to counter any adverse PCA verdict by creating and asserting their version of international law through the establishment of Chinese jurisdictions complete with local courts with claims that international law authority over vast areas of the South China Sea. If this gambit succeeds, UNCLOS will no longer have any authority in the South China Sea because it is no longer “sea” as understood in international law—it will be declared Chinese territory with China enforcing their version what they will call international law. China’s Maritime Militia, managed by PLA military commands and funded by local and provincial governments, is successful and growing, as are armed Chinese fishermen. It is the world’s largest such organization. It was employed in the 2009 Impeccable incident, at Scarborough Shoal in 2012, and in support of exploration drilling in Vietnamese waters 2014. It has a publicly declared presence on new artificial features in South China Sea. China seized control of the dominating narrative, at least where it counts—with their own population and those of their South China Sea neighbors. Repeated assertions of undisputed historical sovereignty, officially in communications with the UN and publicly in hyper-nationalistic media, raise the stakes considerably. The United States is consistently portrayed as the threat to regional peace and stability and as a violator of Chinese sovereignty. The United States is charged with “containment.” Challenges to ships and airplanes are becoming more aggressive. Surveillance missions, conducted lawfully from international waters and airspace now endure unprofessional “close aboard” intercepts and acrobatics. PLA Navy and Air Force units in the vicinity are gaining strength over time. The Chinese narrative may now be driving the situation instead of describing it. Today’s situation in the South China Sea is increasingly identified with the Chinese Communist Party’s (CCP) mission to recover Chinese territory lost to the west—and to Japan—during the “Century of Humiliation” from the mid-nineteenth century Opium Wars to the CCP’s victory over the Nationalists in 1949. Victory over Nationalist, Japanese and Western forces coupled with economic growth since the rise of Deng Xiaoping largely form the justification of continued CCP rule. Given today’s economic challenges in China, including increasing violent unrest, the recovery of lost territory assumes even greater importance. In 2009, the Chinese declared: “China has indisputable sovereignty over the islands in the South China Sea and the adjacent waters, and enjoys sovereign rights and jurisdiction over the relevant waters as well as the seabed and subsoil thereof.” Since then, this claim has been repeated often and at all levels. In a November 2015 speech to the Singapore National University Xi Jinping himself stated “The South China Sea islands are China's territory since the ancient times.” It is no surprise that “sovereignty” is a prominent part of China’s response to the tribunal verdict. Applying the term “historical sovereignty” to almost the entire South China Sea embeds this issue in the Chinese Communist Party’s mission to recover territory lost to the West and other powers during the Century of Humiliation. This elevates the South China Sea to a survival-level interest for China’s leadership. The Chinese leadership cannot compromise, let alone back down, without risking severe damage to domestic stability, including nationalist protests and even the survival of the regime itself. The fates of the Qing Dynasty and the Nationalist regime are well remembered, and major leadership changes are due next year. Since May 2015, when we asserted our right to “fly, sail and operate anywhere international law allows,” we performed three very-well-telegraphed “Freedom of Navigation” operations. But “Innocent Passage” rules were reportedly followed, and the message became confused. Operations of U.S. naval and air forces are a critical, necessary response in this situation. They must be continued and even increased, and done without publicity and fanfare. But they are not, by themselves, sufficient. A much more difficult challenge is assuring the access of all claimants to the resources of the sea, both animal and mineral. This will require maritime law enforcement means as well as some agreed-upon system for responsible and sustainable resource management. For our part, our much-discussed “pivot” to Asia is incomplete. Defense and security initiatives are moving forward deliberately but the centerpiece of our engagement with Asia, the Trans-Pacific Partnership (TPP), is stalled. Our quadrennial election rhythms and requirements have overtaken TPP progress. The Republican and Democratic presidential candidates are both now solidly antitrade—ironically an area of agreement in this dismal political process. An end of the year push for ratification in a lame duck Congress will be risky, as the president-elect as well as much of the electorate is sure to be dead set against it, if we take each at his or her word. At best, perhaps we can get a “reset” but that will require—if not major rewrite and time-consuming referral back to the signatories—major “trade adjustments” at home to protect threatened constituents before Senators can support ratification without career change. Far from a tangential issue, TPP purgatory damages our prestige when we need it most. The TPP’s ever-pending status sends a message that our “pivot” is solely about militarizing our Asian policy. The longer the “pivot” is perceived to be only about the military, the longer we will be hampered in our diplomacy, the longer the “containment” myth will be perpetuated and the longer our friends will be left hanging. Given China’s often declared and well signaled intentions, our position in the region must be founded on an undoubted deterrent capability centered on the defense of Japan and other nations in the First Island Chain and bordering the South China Sea. “Given rapid advances in Chinese military capabilities, the consequences of conflict with that nation are almost unthinkable and should be avoided to the greatest extent possible, consistent with U.S. interests. It is therefore critical to achieve the right combination of assurance and dissuasion and to maintain a favorable peace before conflict occurs. At the same time the ability of the United States to work with both allies and partners to achieve those peaceful ends will depend on the perceptions both of allies and partners and of China of the U.S. ability to prevail in the event of conflict.” This is especially important to deterring a seizure, or a blockade, of additional features. Allied and partner nations need to fully contribute to the security of threatened territory. Unilateral U.S. action is not a viable course of action. Japan’s skillful and determined actions in the East China Sea provide a powerful precedent. In addition to military capabilities, and perhaps even more urgent, is the creation of powerful maritime surveillance and maritime law enforcement capabilities. Our allies and partners need to be able to counter illegal activities in their own seas. Coupled with this might be an aggressive diplomatic effort to create a system to manage marine resources—primarily fish, but also seabed minerals. Any purposeful destruction of the common environmental heritage of the global commons must bring a severe political and reputational price. Supporting and advocating a marine conservation and restoration effort should allow us to regain a bit of dominance in the ongoing competition over the narrative. Perhaps non-governmental environmental organizations can find their voice again if a preservation and restoration effort gets started. The creation of a system that establishes and enforces rules of conduct over fish and minerals can be a positive for those industries. This problem is not confined to the South China Sea. China’s raids on the coral resources in Japan’s Ogasawara islands about one thousand kilometers south of Tokyo has generally passed without comment in much of the global media. Ubiquitous surveillance capability including details of fishing boat locations, with real time public results, must be deployed. The Asia Maritime Transparency Initiative at the Center for Strategic and International Studies provides a very compelling early prototype that should be expanded in both detail and coverage. A system of radars, coast watchers, expanded law enforcement, dispute resolution forums and social media exposure of Illegal, Unregulated and Unreported—the so-called IUU—fishing with pictures, identification and geolocation may also be helpful. Port and airfield infrastructure construction along the littoral would aid commerce as well as law enforcement. Funding could be through loans, foreign aid and mutual development projects by the United States, Japan, Australia and India. Conversion of civil aircraft and ships to Coast Guard and Fisheries Enforcement craft would aid surveillance and enforcement efforts. Other actions we might consider include maritime coalition activities without declarations. Quiet but effective cooperation among the United States, Japan, Australia and India would be very helpful. Trade deals do not have to wait for us to sort out the TPP again. Our industries, our states and our municipalities can be far more adept at the retail level than the federal government. Sister city, sister county, and similar arrangements are guaranteed to have more local salience than something designed in Washington to fit all. We already have significant activity underway, especially in agriculture. This new phase in the South and East China Seas calls for a new, broader, stronger, approach. It’s no longer just “fly, sail and operate” with military and naval forces, although that is the foundation. It’s protein and energy for growing populations in all of Asia. The challenge moves to new levels and we must move with it—or preferably ahead of it. Within a framework of undoubted deterrent capability, we must counter “grey zone” challenges with compelling strategies to enhance the common welfare of all affected nations. We must make the “global commons” real. It must be an offer no nation can refuse. Our active leadership must be brought to the building of support across many diverse interests.” http://nationalinterest.org/feature/south-china-sea-its-not-just-about-the-rocks-its-also-about-17206

China's Unique Space Ambitions. Dr. Namrata Goswami, The Diplomat. “China’s space ambitions and goals are unique. Unlike the space rivalry between the United States and the former USSR, which was mostly about “who got where first” (prestige and status) as well as geopolitical rivalry, China’s space ambition is to harness the vast resources available in space to benefit and sustain its economic rise. When Sputnik burst into the skies on October 4, 1957, it took the United States by surprise. For one, the U.S. considered itself to be the leaders in science and technology; for another, the U.S believed that the USSR was a poor, peasant-based economy, incapable of cutting-edge space technology. Sputnik was a shocker as it showcased the Soviet Union’s high-end technology, skyrocketing its international prestige and aggravating U.S. fears that the USSR could now use rockets to transfer inter-continental ballistic missiles (ICBMs) to space, from where the U.S would be an easy target. Almost all space endeavors after the Sputnik moment between the U.S and USSR were informed by prestige-seeking behavior, jealousy, and Cold War rivalry. Unlike Cold War geopolitics and space politics, China’s space program, which achieved technological prowess in the early 21st century, is venturing beyond simply seeking prestige and status. While it is prestigious to show off one’s technological capabilities in space, China’s space program exhibits a long term vision to explore space for harnessing resources from the moon, asteroids, and establishing a permanent presence. There are three areas in particular where China’s space activities are focused at this point in time: Space-Based Solar Power (SBSP), lunar and asteroid mining, and establishing its own space station. SBSP has the potential to harness solar power in space, where the rays of the sun are constant, and beam that energy from satellites by the use of microwave technology to receiving stations on earth. This energy is clean, renewable, and constant. China’s space solar ambitions were outlined in a report by its leading space agency, the China Academy of Space Technology (CAST). The report stated, “In 2010, CAST will finish the concept design; in 2020, we will finish the industrial level testing of in-orbit construction and wireless transmissions. In 2025, we will complete the first 100kW SPS demonstration at LEO; and in 2035, the 100mW SPS will have electric generating capacity. Finally in 2050, the first commercial level SPS system will be in operation at GEO.” An SBSP station would need to clear many technological hurdles: the discrepancy between the station’s weight (10,000 tons) compared to what rockets can lift today (100 tons); the problem of transferring energy from space via microwaves; precise attitude control as well as on-orbit manufacture/assembly/integration (MAI). Significantly, however, China has recognized that investing in SBSP research and development is to think big long term in order to ensure a seamless energy flow for future generations. Thus China is committed to start working on building space solar infrastructure in orbit, especially in low earth orbit (LEO) and geostationary Earth orbit (GEO) 22,000 miles above earth. China’s energy consumption levels grew from 18 quadrillion Btu in 1980 to 37.1 quadrillion Btu in 1996. It is projected to be 98.3 quadrillion Btu by 2020. China is also projected to become the world’s largest economy by 2028, both in Purchasing Power Parity (PPP) and Market Exchange Rate (MER), and its energy demands have to sustain its economy, According to Lt. General Zhang Yulin, deputy chief of the Armament Development Department of the Central Military Commission, China will be developing space technology to exploit the earth-moon space to harness solar energy once its space station is built by 2020. Zhang stated that “The earth-moon space will be strategically important for the great rejuvenation of the Chinese nation.” China’s next big space ambition is to exploit resources like titanium, helium-3, and water from the far side of the moon. Its Chang’e lunar exploration program, launched on Long March rockets, is an ongoing robotic mission to the moon led by the China National Space Administration. The Chang’e 1, launched in 2007, was primarily aimed at building the basic infrastructure required for exploration of the moon; analyzing the distribution of resources like helium-3 on the lunar surface; as well as obtaining three dimensional images of the moon. Chang’e 2, launched in 2010, has now reached the Lagrangian point L2 about 1.5 million km from Earth, “where gravity from the sun and Earth balances the orbital motion of a satellite.” The Chang’e 3, launched in 2013, was China’s first moon soft lander, carrying Yutu, the moon rover. In 2017, China plans to launch the Chang’e 5, which will be a sample return mission aimed at getting 2 kg of lunar soil and rocks back to earth for research. Resource-rich asteroids are the next big step. For example, Asteroid Ryugu, made up of tons of nickel, iron, cobalt, is estimated to be worth $95 billion. And there are millions of asteroids in space waiting to be harnessed, carrying resources like gold and platinum. In July 2015, an asteroid rich in platinum worth $5.4 trillion flew 1.5 million miles from earth. While the Outer Space Treaty of 1967 prohibits any country from appropriating space territory as sovereign territory, the treaty is rather vague with regard to space resource ownership; if it is “first come, first serve” — as was the case with the moon rocks that the U.S. astronauts brought back with them after the moon landing in 1969 — China could fundamentally follow the same principle. The Chinese are understandably intent on racing ahead with both lunar and asteroid exploration programs due to their future energy needs. Ye Peijian from CAST stated that China is investing in research in both Mars and asteroid exploration. Hexi Baoyin, Yang Chen, and Junfeng Li at Tsinghua University in Beijing have published findings on how to nudge an asteroid into Earth’s orbit. The idea is to capture a Near Earth Object (NEO) or asteroid with low energy orbit and place it on earth’s orbit temporarily in order to develop the capacity and technology to extract resources from NEOs. China, prevented from participating in the International Space Station (ISS) by an Act of the U.S. Congress since 2011, has invested heavily in developing its own space station by 2020, named Tiangong (Heavenly Palace). China launched the Tiangong 1 in 2011. The Tiangong 2 is to be launched in September this year and the Tiangong 3 in 2020. The Tiangong orbital space station, consisting of a 20 ton core module as well as two research modules, will support three astronauts for a long term stay. Given the ISS is scheduled to retire by 2025, the Tiangong may be the only human space station we are left with. Here too, China’s space ambition is different from both the United States and Russia. It is focused on creating a long term, permanent presence in space. Despite stated goals by former U.S. President George W. Bush and President Barack Obama to work toward cementing the U.S. presence in space, the NASA budget has been declining over the years, the Apollo space shuttle program has retired, and U.S. space activity appears to lack both inspiration and imagination. Only private parties like Planetary Resources have shown interest in asteroid mining. On the other hand, China is investing heavily on its official space program. China has long term ambitions for deep space exploration as well as a mission to Mars. Most importantly, its space program is not focused primarily on geopolitical rivalry, resulting in short stays as was the case with the U.S and former USSR (now Russia). Rather, China is focused on long term activities to generate resources and establish a permanent space presence. The ambiguity of international space law with regard to ownership of property in space will work to China’s advantage as it will be based on “first come, first serve.” The rules of the game therefore needs to be crafted within the next five years to create a level playing field in space, the common heritage of humankind.” http://thediplomat.com/2016/08/chinas-unique-space-ambitions/

F.B.I. Employee Pleads Guilty To Acting As An Agent Of China. Benjamin Weiser and Megan Jula, The New York Times. “The federal authorities on Monday secured a guilty plea from a longtime employee of the Federal Bureau of Investigation accused of lying about his relationship with a Chinese technology company and various Chinese associates, including some people with ties to the Chinese government. The government charged that the F.B.I. employee, Kun Shan Chun, had “expressed a willingness to facilitate the passage of sensitive United States government information” to his Chinese associates, including some with connections to the Chinese government. Federal prosecutors in Manhattan said that Mr. Chun had also made a series of false statements to the bureau regarding his contact with these Chinese nationals and a firm based in China, Zhuhai Kolion Technology Company, “as part of a longstanding and concerted effort to conceal these relationships.” Mr. Chun, who is known as Joey and who works in the F.B.I.’s New York office, pleaded guilty on Monday before a federal magistrate judge in Manhattan to one count of acting in the United States as an agent of China. The count carries a maximum term of 10 years. Mr. Chun, 46, had been charged with four counts, according to the complaint, including making false statements in a written questionnaire submitted to the F.B.I. in connection with his security clearance. Mr. Chun’s federal public defender, Jonathan Marvinny, said in a statement after the hearing: “Today Joey Chun accepted responsibility for some mistakes in judgment that he deeply regrets. The truth is that Mr. Chun loves the United States and never intended to cause it any harm. He hopes to put this matter behind him and move forward with his life.” According to the complaint, Mr. Chun was born in Guangdong, China, around 1969, entered the United States around 1980 and became a naturalized American citizen in 1985. Mr. Chun had worked at the F.B.I.’s New York field office as an electronics technician assigned to the bureau’s technical branch, the complaint said. He has had a “top secret” security clearance since 1998. The F.B.I. and the United States attorney’s office in Manhattan each had no immediate comment on the case. The complaint was signed by F.B.I. Special Agent Jason Levitt, who wrote that the focus of his counterintelligence work had been to investigate the foreign intelligence activities of the People’s Republic of China. The complaint was approved by two federal prosecutors in Manhattan and two trial lawyers from the Justice Department’s Counterintelligence and Export Control Section in Washington.” http://www.nytimes.com/2016/08/02/nyregion/fbi-employee-pleads-guilty-to-acting-as-an-agent-of-china.html?_r=0

Japan Defense Report Stresses Growing Threat From China. Seth Robson, Stars and Stripes. “China’s military build-up in an “increasingly severe” Far East security environment is a major focus of Japan’s annual defense report. The 484-page white paper, approved Tuesday by the nation’s cabinet, devotes more words to China than other regional powers like North Korea and Russia. “There has … been a noticeable trend among neighboring countries to modernize and reinforce their military capabilities and to intensify their military activities,” says the report, which details Chinese activities in the South China Sea where it is involved in territorial disputes with a number of Southeast Asian nations. Last month, an international court ruled against China’s claims to artificial islands on which it is building military facilities near the Philippines in the sea where $5 trillion in global trade transits annually. China’s state-aligned Global Times newspaper described the ruling as a “piece of trash.” Chinese incursions into waters around the Japanese-administered Senkaku Islands in the East China Sea, including one in June by a Chinese naval ship, are also detailed in the report. “It was the first case by Chinese Naval combatant ship to enter that contiguous zone,” the white paper says. Also in June, and for the first time in 12 years, a Chinese intelligence ship sailed in Japanese waters near Kuchinoerabu Island, according to the report. Japan’s Air Self-Defense Force scrambled jets 873 times in fiscal year 2015, including 571 sorties against Chinese aircraft, up by 107 against the Chinese the previous year, the report says. The paper also notes that China’s defense budget has recorded double-digit annual growth consistently since 1989. “China is currently carrying out reforms of the [People’s Liberation Army] which some see as being the largest in the country’s history,” the report says. “Recently the reforms have taken place at a rapid pace.” A section on North Korea says the regime, which conducted its fourth nuclear test in January and sent a satellite into orbit the following month, might be able to produce a nuclear weapon small enough to launch on a long-range missile. “North Korea’s nuclear weapons development is a grave and imminent threat to the area including our country and international security,” the report says. “It simply cannot be accepted as it seriously affects peace and stability.” The paper also notes President Obama’s visit to Hiroshima in May, describing it as an “extremely important historical opportunity, which will boost international momentum again for a world without nuclear weapons.” http://www.stripes.com/news/pacific/japan-defense-report-stresses-growing-threat-from-china-1.421981

China Developing Naval Aviation Wing To Operate From Aircraft Carriers. K.J.M. Varma, Livemint. “China, which is developing two more aircraft carriers, is building up a naval-aviation division to safeguard the country’s maritime interests amid escalating tensions over the disputed South China Sea. China commissioned its first aircraft carrier Liaoning in September 2012 and launched a specially designed J-15 fighter jets to operate from its deck. Although it’s only about three years since the unit came into being, the carrier-borne force has already trained several groups of J-15 pilots, senior captain Dai Mingmeng, commander of the 2.3-million strong People’s Liberation Army (PLA) Navy’s carrier-based aviation force was quoted as saying by state-run ‘China Daily’. “It will not take long for us to attain full operational capability on the aircraft carrier,” he said. China is developing two more aircraft carriers. Chinese media reported for the first time the crash of one of J-15 jets during the landing exercises on the ground in April this year in which its pilot was killed. One of the J-15s crashed after its computers reported a malfunction in the flight-control system. An investigation concluded that the pilot had tried unsuccessfully to save the plane and he had no option but to eject from the cockpit before the fighter aircraft crashed, the report said. Because the plane was at a relatively low altitude, there wasn’t time for the pilot’s parachute to be fully deployed before Zhang hit the ground. He was rushed to a nearby hospital but died as a result of serious internal injuries, it said. The Chinese military suspended carrier-based jet fighter pilot training for nearly two months after a fatal crash, the Hong Kong-based ‘South China Morning Post’ reported. J-15s are the core jets for China’s aircraft carrier, the Liaoning, and other more advanced domestic carriers which are reportedly under construction. The development of navy’s aviation division came as Beijing strongly defended its claims over the disputed South China Sea (SCS) in the aftermath of international tribunal’s verdict striking down China’s claims over the area. Last month, a UN-backed international tribunal struck down China’s claims over the South China Sea, saying Beijing has no “historic rights” in the disputed area. The tribunal struck a blow to China’s claims over almost all of the SCS, saying that Beijing’s much touted nine-dash line had no legal basis. China has rejected as “null and void” the verdict and said it “neither accepts nor recognizes” the ruling of the tribunal. China claims sovereignty over almost all of SCS based on historic rights, including reefs and rocks in the sea as well as hundreds of miles from Chinese shores.” http://www.livemint.com/Politics/nMFZpE7frII8Lc7OGfnLOP/China-developing-naval-aviation-wing-to-operate-from-aircraf.html

South China Sea: Beijing Vows To Prosecute 'Trespassers'. James Griffiths, CNN. “China has sent a clear warning to foreigners who enter contested areas of the South China Sea -- stay away or you'll be prosecuted. The warning came in a detailed explanation of last month's Hague ruling, which found that China's territorial claims in region have "no legal basis" under the U.N. Convention on the Law of the Sea. China claims almost all of the South China Sea, including islands more than 800 miles (1,200 kilometers) from the Chinese mainland, despite objections from neighbors including the Philippines, Malaysia, Brunei and Vietnam. On Tuesday, the Chinese Supreme People's Court issued a regulation on judicial interpretation saying there was a "clear legal basis for China to safeguard maritime order, marine safety and interests, and to exercise integrated management over the country's jurisdictional seas." Michael C. Davis, a law professor at Hong Kong University, told CNN the supreme court's statement was "worrisome." "This is kind of an ominous suggestion that they will be prosecuting people who enter the waters that China claims," he said. The Hague ruling found that China had no historic title to the waters and had breached the sovereign rights of the Philippines, which brought the case. The court also ruled that many purported islands controlled by China are not in fact, islands, but instead reefs or rocks, which do not generate territorial rights. China's top court did not directly reference the Hague ruling, but said that "judicial power is an important component of national sovereignty." China fiercely guards what it regards as its territorial waters, attacking and arresting foreign fishermen who work near islands controlled by Beijing. The supreme court said Chinese citizens or foreigners who engage in illegal hunting or fishing in the waters will be criminally prosecuted. It classified several situations as "illegally entering Chinese waters," including remaining or reentering waters "after being warned and driven away," that could result up to a year in prison. In May, Vietnamese fishermen told CNN how Chinese-flagged vessels raided their boats and stole equipment in the waters near the Paracel Islands. Davis warned that the direction could mean Filipino fishermen operating in waters the UN tribunal ruled belong to the Philippines could be apprehended by Chinese vessels and be "prosecuted in direct contradiction of the (Hague) ruling." The supreme court also said that Chinese fishermen who violate environmental protection laws in the South China Sea could be prosecuted. Davis said that this could be "a signal they will require their fishermen to adhere to environmental standards, which they haven't in the past." The Hague tribunal found that Chinese fishermen and reclamation projects had caused "irreparable harm" to the region's marine environment. In recent months, Beijing has reacted angrily to U.S. and Australian freedom of navigation operations in the region, scrambling fighter jets and boats and denouncing the nations' navies as "threatening Chinese sovereignty." Last week, state-run Chinese newspaper Global Times accused Australia of making itself "a pioneer of hurting China's interest with a fiercer attitude than countries directly involved in the South China Sea dispute." Canberra was one of the first governments to voice support for the Hague ruling and encourage others to abide by it. However, while the ruling is considered legally binding, there is no mechanism to enforce it.” http://www.cnn.com/2016/08/02/asia/south-china-sea-supreme-court/

Australia Set To Gather Intelligence On Military Drills Between China And Russia. David Wroe, The Sydney Morning Herald. “Australia is likely to have military assets in the South China Sea to gather vital intelligence on a joint drill between Chinese and Russian forces next month, Fairfax Media understands. The exercise between Chinese and Russian ships and planes is intended to send a signal of defiance to the West but defence sources and experts say it will also provide a gold mine of intelligence on how the major powers' militaries work together. A Defence source told Fairfax Media that assets were expected to be used to collect information, though the source declined to say what kind. "It would be foolish for Defence to miss an opportunity like this," the source said. The deployment of a Collins Class submarine would be one option. The simplest way to observe the drills would be with the RAAF's P-3 Orion surveillance planes, which routinely fly over the South China Sea as part of Operation Gateway. Surface warships could also observe from over the horizon though this is less likely because they are committed elsewhere. This overt observation is more likely to be undertaken by the US Navy, Fairfax Media has been told. The Australian Defence Force has in the past adjusted the timing of Operation Gateway patrols to match events of particular interest. Defence has previously said it varies the path of such patrols depending on what is worth observing, including whether to devote more effort for example to the South China Sea rather than the Indian Ocean. Peter Jennings, executive director of the Australian Strategic Policy Institute, said it would be "routine business for Australia to want to observe such an exercise with its P-3 maritime surveillance aircraft". "I imagine there would be a great deal of interest from us and the Americans in how effectively the Chinese and Russians are able to operate together," he said. Mr Jennings, a former senior Defence Department official, said the joint exercise was "more about political show than genuine military co-operation". "Increasingly [Russian President Vladimir] Putin and [Chinese President] Xi [Jinping] identify each other as like-minded countries that are prepared to push against the established international system," he said. "It's a marriage of strategic convenience which is designed to create maximum discomfort for the US and its allies." Retired Royal Australian Navy rear admiral James Goldrick said it would "certainly be worthwhile" to observe the drills. Planes or ships would not need to get too close, but rather could observe from over the horizon and pick up signals and radar signatures. "It wouldn't be a matter of having to fly 500 metres overhead," he said. Mr Goldrick said even if they weren't natural allies in the long term, China's and Russia's interests currently were aligned around opposing "the world order that they see effectively as having been set up by the US". Mr Putin had calculated that China rather than the US was a preferable relationship to "restore Russia to where it thinks it ought to be", he said.” http://www.smh.com.au/federal-politics/political-news/australia-set-to-gather-intelligence-on-military-drills-between-china-and-russia-20160801-gqiecw.html

Former Goldman Star O'Neill May Quit UK Government Over China. William James, Reuters. “High-profile British Treasury Minister Jim O'Neill, a former Goldman Sachs chief economist, could quit his post over Prime Minister Theresa May's new approach to Chinese investment, the Financial Times reported, citing a friend of O'Neill. May intervened personally last week to delay the final decision on a partly-Chinese funded nuclear power project, a source said on Saturday, while a former colleague said May had previously expressed concern about the national security implications of the planned Chinese investment. O'Neill is a member of the unelected upper house of parliament and works in the finance ministry as Commercial Secretary, with responsibilities including infrastructure policy and promoting Britain as a source of foreign direct investment. Widely respected and influential in the global investment community, his appointment in 2015 was considered a major coup for the British government. He kept his role despite sweeping changes to the government in July following May's promotion to leader after David Cameron's resigned. "He’s considering why he has been asked to stay," said one friend according to the Financial Times. The friend said O'Neill was baffled about the government’s change of tack on China, and will quit unless May can explain why she wants him to stay, according to the FT report. The Treasury declined to comment on the report. In her previous role as interior minister, May had expressed concerns about the government's approach to Chinese investment, citing national security concerns, according to Britain's former business secretary Vince Cable. O'Neill had been heavily involved in former finance minister George Osborne's push for a "Golden Era" of relations between the two countries, largely based on courting Chinese investment in British infrastructure. Osborne left the government earlier this month along with Cameron in the wake of the country's vote to leave the European Union. He was replaced by former foreign minister Philip Hammond. China General Nuclear Power Corp (CGN) was set to invest around 6 billion pounds ($7.93 billion) for a 33 percent stake in the Hinkley Point nuclear project, paving the way for it to lead another project in Britain that would use Chinese nuclear technology. A decision is now due by the autumn, possibly as early as September.” http://www.reuters.com/article/us-britain-nuclear-oneill-idUSKCN10B0Z6

Laos: Struggling To Get Out Of China's Shadow. Helen Clark, Lowy Interpreter. “In the lead up to the event held in the Laos capital of Vientiane, many wondered if the South China Sea dispute would wreak the same havoc as it did at the Cambodia meeting four years ago, when a failure to agree meant hat, for the first time in 45 years, no joint communique was issued. This time around, a joint communique was agreed upon. The recent UN arbitration on the South China Sea case brought by the Philippines against China was not mentioned, as Cambodia opposedthe proposed wording. The statement did, however, cite the United Nations Convention on the Law of the Sea, and as such was a partial win for the Philippines and Vietnam. However Laos, rarely in the international spotlight, has interests that extend well beyond playing part time arbiter in a dispute it is not directly involved in. As Prashanth Parameswaran wrote on The Diplomat last week: The priorities that Lao officials outlined this year also reflect the country’s sense of what it would like to promote in the regional agenda... the focus on narrowing the development gap and a work plan for the Initiative for ASEAN Integration... directly benefits Vientiane. On the rare occasions the international community considers Laos politics, the focus is generally on the pro-China and pro-US factionalism. This basic, single point of analysis has left some time long observers despairing. University of Queensland Emeritus Professor Martin Stuart-Fox has long decriedthe simplistic idea of US-China competition within Lao’s 41-year ruling Communist Party, noting that Laos has been balancing its trilateral big power relations (Thailand, China and Vietnam) for centuries, and often done quite well out of it. If anything, there is more a of a pro-Vietnam versus pro-China split in the Party. (The same speculation over factionalism afflict lower level analysis of Vietnam, though this is arguably for more concrete reasons given Vietnam has grown closer to the US since China's aggression in the South China Sea.) For the record, at a party congress earlier this year. Foreign Minister Thongloun Sisoulith was elected Laos Prime Minister. As Foreign Minister he was seen as something of a multilateralist, improving ties with neighbours Vietnam and China as well as the US, and the rest of Southeast Asia. As noted on the CogitAsia blog: 'While many commentators look for signs of pro-Vietnam or anti-China leanings in the new government, Thongloun has been regarded as a relatively neutral leader in the Politburo'. However the Party has more on its mind than geopolitical allegiances. One of the smallest and poorest of ASEAN members, the country's international 'coming out' began with the hosting of the Southeast Asian Games in 2009, followed by the chairmanship of the ASEAN-Europe Meeting (ASEM) in 2012. Laos would clearly like a bigger international profile, keen to be known as the nation that is 'land-linked' as opposed to 'land-locked'. Sticking points for the country are its hydro dams like the Xayaburi — Laos has been arguing with Vietnam for years over what that would do to Vietnam’s river systems — and human rights. The disappearance of NGO worker Sombath Somphonehas yet to be explained, and freedom of speech has not improved in recent years. Laos wants to make good, or better, on its hopes of being 'land linked' and serve as a useful conduit and trade route between larger countries. More generally, it wants to increase development, and views ASEAN integration and groups like the ASEAN Economic Community (EAC) as useful, especially as most of its trade is within ASEAN. There have been meetings about this, of course, but issues between China and its neighbours tend to suck up all the airtime, leaving little time to consider how smaller nations can grow their economies within a regional framework, or how a one party state much smaller than its communist neighbours manages economic transition. China has been extremely useful as Laos pursued development but now Laos has an appetite for some cross-regional discussion of how to further that development, it seems China is getting in the way.” http://www.lowyinterpreter.org/post/2016/08/01/Laos-Struggling-to-get-out-of-Chinas-shadow.aspx#.V58rN5ycVVE.twitter

The U.S.-China Cyber Agreement: A Good First Step. Scott Harold, The Cipher Brief. “After years of the U.S. suffering losses valued in the billions of dollars due to economically-motivated cyber espionage from China, there are some signs that China has begun to reduce its intrusions into U.S. private sector firms’ computer networks. What led to this unexpected change in Chinese behavior? Is it because of the high-profile agreement signed by President Barack Obama and Chinese President Xi Jinping last September? How sustainable is that agreement? And what broader implications does it have for the overall U.S.-China relationship? The answers to these questions carry important consequences for U.S. national interests. It remains somewhat unclear whether China has indeed reduced its intrusions into U.S. private sector computer systems, as some U.S. cybersecurity firms that previously tracked Chinese cyber threat actors have claimed. The nature of hacking is such that it is virtually impossible to ever know for certain exactly what level of intrusion sets are occurring. If China did reduce its economically-motivated cyber espionage, there are a number of possible explanations for why it did so. Some observers have argued that China actually started cutting back several months before last fall’s summit agreement, perhaps taking steps to exert greater control over the community of military hackers. Other observers suspect that Chinese hackers may have simply redirected their efforts to other, more valuable or more vulnerable targets in other countries. Others believe China was spurred to curtail its theft of intellectual property by the U.S. indictments of five Chinese military officers in 2014. Such observers also point to the hurried, unscheduled visit to Washington in early September last year of Meng Jianzhu, a high-ranking Chinese Communist Party official in charge of political and legal affairs, just after the U.S. announcement that it was planning to push ahead with sanctions against Chinese actors for cyberespionage. In this view, Meng’s last minute visit suggests that the Chinese leadership agreed to reduce its hacking of U.S. firms out of a fear that Xi’s visit might be preceded by additional U.S. indictments of Chinese hackers. Finally, some analysts worry that Chinese hackers, who were notoriously sloppy in their operational security, may simply have improved their practices and are now better able to mask their behavior, meaning that hacking hasn’t actually gone down, it simply isn’t being detected as frequently as in the past. None of these explanations suggest that China changed its behavior because it concluded that private sector firms are illegitimate targets. China’s assertions about cyberspace norms focus on the right of states to censor access to online information. Moreover, China’s economy, the commanding heights of which are controlled by the state, differs dramatically from a market economy, where the private sector and the government are cleanly separated, making the U.S. argument that private sector actors are illegitimate targets an alien one to Chinese leaders. Many observers suspect that China’s apparent compliance with the cyber agreement represents little more than a shift in tactics that is probably temporary. Such analysts note that China did not lay down a costly marker, since it did not admit to having previously engaged in cyber espionage. Because it seems unlikely that China has suddenly changed its view of economically motivated cyber espionage wholesale, it is important for U.S. policymakers to keep focused on this issue. The U.S. should make clear that indictments may once again be sought if Chinese hackers resume cyber espionage against U.S. firms. At the same time, the United States should seek to expand the value of the bilateral agreement by supporting the inclusion of U.S. allies and partners so as to guard against possible backsliding or simple retargeting by China. The 2015 cyber agreement should be seen as a potentially important first step, but by no means a final step, toward addressing the broader problem of Chinese espionage. At its heart, reducing cyber espionage against U.S. companies merely addresses a question of means, not ends. Even if China completely eliminates cyber espionage against U.S. companies, it will still continue targeting traditional U.S. national security actors through various means, including cyber espionage. Similarly, Chinese efforts to steal valuable intellectual property and business proprietary information from U.S. private sector enterprises through human agents can also be expected to continue. Additional U.S. attention and resources will be needed to address these challenges. A genuine reduction in Chinese economically-motivated cyber espionage could go some way toward easing tensions in the broader bilateral U.S.-China relationship. But absent changes in Chinese behavior toward U.S. friends and allies, a better attitude toward international law, and improvements in domestic human rights, the ultimate impact of a reduction in economic cyber espionage may simply not go far enough to restore the bilateral relationship to a healthy state.” https://www.thecipherbrief.com/article/tech/us-china-cyber-agreement-possibly-good-first-step-1092

Giving China A Ladder To Climb Down. William Choong, The Strategist. “The 12 July judgment by the Hague-based Arbitral Tribunal on the South China Sea constituted a near-total defeat for China. While it was widely expected that the Philippines would win, it wasn’t expected that China would lose by such a wide margin. Understandably, China has taken a hawkish and resolute stance against the Tribunal. Eager to show China’s resolve in defending its bastions in the South China Sea, China landed two civilian airliners on Mischief Reef on 13 July. It conducted two military exercises near Hainan Island – one just before the 12 July verdict and another the week after – closing off maritime areas and warning mariners that that area was prohibited. There’s now a distinct possibility that tensions will escalate in the South China Sea. Given that the Arbitral Tribunal had ruled that all the features in the Spratlys are either rocks or low-tide elevations, the U.S. now has the legal cover to conduct FONOPs closer to, or even inside, the 12nm zones around the maritime features. In June, French defence minister Jean-Yves le Drian said that France should urge European Union countries to conduct ‘regular and visible’ patrols in the South China Sea. Chinese anger at such overt challenges could well lead to a conflict not from deliberation, but from accidental escalation. Regardless of the verdict, China has a solid physical position in the South China Sea. In February, it was found that China had installed high-frequency radar on Cuarteron Reef, and possibly radars on Gaven, Hughes and Johnson South reefs. Such facilities would enable it to establish control over large swathes of the South China Sea within the nine-dash line. Three 3,000m airstrips in the Spratlys serve to defend China’s advanced submarines based farther north at Hainan Island. Deployed in the South China Sea, Jin-class submarines with JL-2 nuclear missiles can break into the Pacific Ocean to get within striking range of the continental United States. Given such a strategic position – compounded by Xi Jinping’s heady mix of nationalism and rejuvenation from a ‘century of humiliation’ – it would be irrational for Beijing to give up its assets in the Spratlys. The Arbitral Tribunal wasn’t able to rule on questions of sovereignty, and while it did rule that China’s historic rights claim to the nine-dash line was incompatible with UNCLOS, it didn’t conclude that the nine-dash line per se was invalid or illegal. That gives China some wiggle room to continue to press its claim. In the clearest, quasi-authoritative response to the judgment, Wang Junmin, deputy dean of the CPS Postgraduate Institute, notes that the Philippines had used the Chinese expression ‘historic rights’ to argue China hadn’t claimed ‘historic title’ to the South China Sea (the former may include sovereignty, but may equally include more limited rights, such as fishing or rights of access that fall ‘well short’ of claims of sovereignty; the latter is used specifically to refer to historic sovereignty). Writing in the PLA Daily on 18 July, Mr. Wang wrote that Chinese references to ‘historic rights’ doesn’t imply that China doesn’t claim ‘historic title.’ He added that China has ‘historic title’ and ‘historic fishing rights’ in different areas within the nine-dash line. By claiming that China has ‘historic title’ to internal waters in ‘archipelagos or island groups’ that are at a ‘relatively close distance’ and that can be viewed ‘integrated whole,’ China could well draw straight baselines around the features it occupies in the Spratlys and claim extended maritime zones outward. Such a hardened position goes directly against the Tribunal’s conclusions and would likely be challenged by the U.S. It’s time, however, for China and the U.S. to pull back from such a brink. The signs thus far are encouraging. The Chinese government didn’t yield to public calls for a boycott of Philippine goods (Xinhua called this ‘irrational patriotism’), and China has stressed that it would intensify talks for a binding Code of Conduct (COC) for the South China Sea. The U.S. has urged the resumption of bilateral talks between China and other claimants, and encouraged them not to act provocatively. Likewise, the Philippines has responded sensibly, with President Rodrigo Duterte saying he wouldn’t adopt a ‘flaunt or taunt’ position against Beijing. In the medium term, the best approach isn’t to pummel China with the 501-page judgment, but rather, to ensure that it has enough face to pursue tangible and functional outcomes. Those could include accelerating talks for the COC, an expansion of the Code of Unplanned Encounters at Sea (CUES) to include coast guard ships, and getting claimants – like the Philippines – to postpone negotiate directly with the Chinese. Speaking to his American counterpart recently, Admiral Wu Shengli, the chief of the PLA Navy stressed that China would never sacrifice its sovereignty and interests in South China Sea, would never stop construction there and never be caught off guard. Yet he signalled that both sides could cooperate by following CUES and Rules of Behaviour for the Safety of Air and Maritime Encounters. Working on tangible and functional outcomes – and not rubbing China’s nose in the ruling – might well be the best way forward.” http://www.aspistrategist.org.au/giving-china-ladder-climb/

New Report Details Why A War Between China And America Would Be Catastrophic. Dave Majumdar, The National Interest. “A war between the United States and China would cause severe losses on both sides, but – today at least – Beijing would bear the brunt of the casualties. However, as China’s anti-access/area denial (A2/AD) capabilities continue to improve – the balance of losses would shift more towards Beijing’s favor by 2025. Nonetheless, China would still suffer more losses than Washington even at that stage – according to a new report from the RAND Corporation. Victory for either side might prove to be elusive as the conflict could degenerate into inconclusive bloodletting. “As its military advantage declines, the United States will be less confident that a war with China will conform to its plans,” reads the new report by David C. Gompert, Astrid Cevallos and Cristina L. Garafola. “China’s improved military capabilities, particularly for anti-access and area denial (A2AD), mean that the United States cannot count on gaining operational control, destroying China’s defenses, and achieving decisive victory if a war occurred.” A war with China – now and in the future – would likely be fought at sea and in the air, but cyber and space capabilities would play a significant role, according to the report. But the RAND researchers expect that should a war breakout, it would remain a conventional fight. “Each side’s increasingly far-flung disposition of forces and growing ability to track and attack opposing forces could turn much of the Western Pacific into a ‘war zone,’ with grave economic consequences,” reads the report. “It is unlikely that nuclear weapons would be used: Even in an intensely violent conventional conflict, neither side would regard its losses as so serious, its prospects so dire, or the stakes so vital that it would run the risk of devastating nuclear retaliation by using nuclear weapons first.” Moreover, while the RAND study postulates that the United States would strike heavily at the Chinese mainland, the researchers don’t believe that Beijing would strike at the U.S. homeland except via cyber attacks. “We also assume that China would not attack the U.S. homeland, except via cyberspace, given its minimal capability to do so with conventional weapons,” the report states. “In contrast, U.S. nonnuclear attacks against military targets in China could be extensive.” A Sino-American war could develop in a number of ways – including short bloody war or a long and devastating war. Moreover, modern technologies incentivize either side to launch a preemptive attack first. “Sensors, weapon guidance, digital networking, and other information technologies used to target opposing forces have advanced to the point where both U.S. and Chinese military forces seriously threaten each other,” the report reads. “This creates the means as well as the incentive to strike enemy forces before they strike one’s own. In turn, this creates a bias toward sharp, reciprocal strikes from the outset of a war, yet with neither side able to gain control and both having ample capacity to keep fighting, even as military losses and economic costs mount.” In the case of a brief war fought today, American losses would be significant, but Chinese losses might be catastrophic. “If either U.S. or Chinese political leaders authorize their military commanders to carry out plans for sharp strikes on enemy forces, a severely violent war would erupt,” the report reads. “As of 2015, U.S. losses of surface naval and air forces, including disabled aircraft carriers and regional air bases, could be significant, but Chinese losses, including to homeland-based A2AD systems, would be much greater. Within days, it would be apparent to both sides that the early gap in losses favoring the United States would widen if fighting continued.” By 2025, however, China’s military capabilities are likely to have expanded to a point where it will not sustain as many losses. “By 2025, though, U.S. losses would increase because of enhanced Chinese A2AD. This, in turn, could limit Chinese losses, though these would still be greater than U.S. ones,” the report reads. “It could be unclear then whether continued fighting would result in victory for either side.” A longer war would be far more devastating – and could leave both military forces in shambles. “As of 2015, the longer a severe war dragged on, the worse the results and prospects would be for China,” the report states. “By 2025, however, inconclusive results in early fighting could motivate both sides to fight on despite heavy losses incurred and still expected. Although prospects for U.S. military victory then would be worse than they are today, this would not necessarily imply Chinese victory.” In any of the cases above – a war would cause serious losses and enormous economic damage. Indeed, it might deplete the military capabilities of both sides at an unprecedented rate – leaving both vulnerable to other threats. “The unprecedented ability of U.S. and Chinese forces to target and destroy each other – conventional counterforce – could greatly deplete military capabilities in a matter of months,” the report reads. “After that, the sides could replenish and improve their forces in an industrial-technological-demographic mobilization contest, the outcome of which depends on too many factors to speculate, except to say that costs would continue to climb.” The RAND study also makes a few recommendations to mitigate the potential for war.

•U.S. and Chinese political leaders alike should have military options other than immediate strikes to destroy opposing forces.

•U.S. leaders should have the means to confer with Chinese leaders and contain a conflict before it gets out of hand.

•The United States should guard against automaticity in implementing immediate attacks on Chinese A2AD and have plans and means to prevent hostilities from becoming severe. Establishing "fail safe" arrangements will guarantee definitive, informed political approval for military operations.

•The United States should reduce the effect of Chinese A2AD by investing in more-survivable force platforms (e.g., submarines) and in counter-A2AD (e.g., theater missiles).

•The United States should conduct contingency planning with key allies, especially Japan.

•The United States should ensure that the Chinese are specifically aware of the potential for catastrophic results even if a war is not lost militarily.

•The United States should improve its ability to sustain intense military operations.

•U.S. leaders should develop options to deny China access to war-critical commodities and technologies in the event of war.

•The United States should undertake measures to mitigate the interruption of critical products from China.

•Additionally, the U.S. Army should invest in land-based A2AD capabilities, encourage and enable East Asian partners to mount strong defense, improve interoperability with partners (especially Japan), and contribute to the expansion and deepening of Sino-U.S. military-to-military understanding and cooperation to reduce dangers of misperception and miscalculation. Ultimately, war is not in the interests of either the United States or the People’s Republic of China. Unfortunately, increases in ones’ own defensive capabilities often causes insecurity in another – part of the so-called Thucydides Trap. But as renowned Harvard scholar Graham Allison wrote – the Thucydides Trap is not unavoidable. “A risk associated with Thucydides’ Trap is that business as usual – not just an unexpected, extraordinary event – can trigger large-scale conflict. When a rising power is threatening to displace a ruling power, standard crises that would otherwise be contained, like the assassination of an archduke in 1914, can initiate a cascade of reactions that, in turn, produce outcomes none of the parties would otherwise have chosen,” Allison wrote for the Atlantic. “War, however, is not inevitable.” http://nationalinterest.org/blog/the-buzz/new-report-details-why-war-between-china-america-would-be-17210

'Give Them A Bloody Nose': Xi Pressed For Stronger South China Sea Response. Ben Blanchard and Benjamin Kang Lim, Reuters. “China's leadership is resisting pressure from elements within the military for a more forceful response to an international court ruling against Beijing's claims in the South China Sea, sources said, wary of provoking a clash with the United States. China refused to participate in the case overseen by the Permanent Court of Arbitration in The Hague. It denounced the emphatic July 12 ruling in favor of the Philippines as a farce that had no legal basis and part of an anti-China plot cooked up in Washington. The ruling has been followed in China by a wave of nationalist sentiment, scattered protests and strongly worded editorials in state media. So far, Beijing has not shown any sign of wanting to take stronger action. Instead, it has called for a peaceful resolution through talks at the same time as promising to defend Chinese territory. But some elements within China's increasingly confident military are pushing for a stronger - potentially armed - response aimed at the United States and its regional allies, according to interviews with four sources with close military and leadership ties. "The People's Liberation Army is ready," one source with ties to the military told Reuters. "We should go in and give them a bloody nose like Deng Xiaoping did to Vietnam in 1979," the source said, referring to China's brief invasion of Vietnam to punish Hanoi for forcing Beijing's ally the Khmer Rouge from power in Cambodia. The sources requested anonymity because they were not authorized to speak to the media. President Xi Jinping has assiduously courted and thoroughly cemented his leadership over the PLA and faces no serious challenges to his command. While he is overseeing sweeping military reforms to improve the PLA's ability to win wars, he has said China needs a stable external environment as it deals with its own development issues, including a slowing economy. And few people expect any significant move ahead of Xi's hosting of a G20 summit in September. But the hardened response to The Hague ruling from some elements of the military increases the risk that any provocative or inadvertent incidents in the South China Sea could escalate into a more serious clash. Another source with ties to the leadership described the mood in the PLA as hawkish. "The United States will do what it has to do. We will do what we have to do," the source said. "The entire military side has been hardened. It was a huge loss of face," he said, declining further comment. Chinese Defence Ministry spokesman Yang Yujun, asked whether the PLA was pushing for a stronger response, repeated that the armed forces would resolutely defend China's territory and maritime rights, and peace and stability, while dealing with any threats or challenges. Retired military officers and army-linked academics have pushed home a strongly martial message. "The Chinese military will step up and fight hard and China will never submit to any country on matters of sovereignty," Liang Fang, a professor at the military-run National Defence University, wrote on his Weibo microblog about the ruling. It is not clear exactly what steps military hardliners are considering. Much attention has been focused around the potential establishment of an Air Defence Identification Zone (ADIZ) for the South China Sea, which would require international aircraft to identify themselves to Chinese authorities. Other options floated by those linked to the PLA include putting missiles on bombers patrolling the South China Sea capable of hitting targets in the Philippines or Vietnam. Yue Gang, a retired colonel, said China's announcement promising regular air patrols over the region showed it was seeking to deny the U.S. air superiority afforded by aircraft carriers. China should be confident enough to provoke an incident and drive the U.S. out, he added. "China is not intimidated by U.S. carriers and is brave enough to touch off an inadvertent confrontation," Yue wrote on his Weibo account. China's military build-up in the region looks set to quicken regardless of any action. "We must make preparations for a long-term fight and take this as a turning point in our South China Sea military strategy," Li Jinming of the South China Sea Institute at China's Xiamen University wrote in the Chinese academic journal Southeast Asian Studies. Despite the saber rattling, there have been no firm military moves that could cause an escalation of tensions. Diplomats and sources said the Chinese leadership was well aware of the dangers of a clash. "They're on the back foot. They're very worried by the international reaction," said one senior Beijing-based diplomat, citing conversations with Chinese officials. "They are genuine about wanting to get talks back on track. The leadership will have to think long and hard about where to go next." Within China's armed forces there is a recognition that China would come off worst in a face-off with the United States. "Our navy cannot take on the Americans. We do not have that level of technology yet. The only people who would suffer would be ordinary Chinese," said the source with ties to the military. Those voices appeared to have the upper hand for now, the source said, pointing to a realization that the 1979 border war with Vietnam did not go as well for China as the propaganda machine would like people to believe. Even setting up an ADIZ, like the one Beijing set up over the East China Sea in 2013 to anger from the United States, Japan and others, would be difficult to enforce given the distance from the mainland. China has repeatedly said it has the right to set up an ADIZ but that the decision depends on the level of threat it faces. A second source with leadership ties put it bluntly: "War is unlikely". "But we will continue to conduct military exercises," the source said. "(We) expect U.S. naval vessels to continue to come," and "miscalculation cannot be ruled out". Foreign Minister Wang Yi has stressed the importance of dialogue, saying it now was the time to return things to the "right track" and to "turn the page" on the ruling. The United States has responded positively to these overtures, sending U.S. National Security Adviser Susan Rice to China this week with a call for calm. Washington is also using quiet diplomacy to persuade other regional players not to move aggressively to capitalize on the ruling. China has been angered by U.S. freedom of navigation patrols in the South China Sea, but its forces have responded only by shadowing U.S. vessels and warning them, showing China's unwillingness to goad the U.S. military unnecessarily, according to Western and Asian diplomats. China is also wary of any incident overshadowing the G20 summit in Hangzhou in September, the highlight of this year's diplomatic calendar for Xi when he will be host to the leaders of most of the world’s economically most powerful countries, the sources said. The Beijing-based diplomat said it was more likely China would choose the period between the end of the G20 and the U.S. presidential election in November to make any move. "But that is a misjudgment if China thinks the United States will just sit back and do nothing," the diplomat said.” http://www.reuters.com/article/us-southchinasea-ruling-china-insight-idUSKCN10B10G

Chinese Graft-Busters Take Aim At Another PLA General. South China Morning Post. “A senior PLA officer who played a lead role in organising a massive military parade in Beijing last year was put under investigation for suspected corruption last week, according to two military sources. Major General Qu Rui, a deputy chief of the Combat Operations Department under the newly established Joint Staff Department, was taken away by military graft-busters during a meeting on Wednesday, sources said. Qu was a key organiser of September’s parade in the capital to mark the 70th anniversary of the end of WW II. Rooting out PLA corruption is helping Xi Jinping to build his power base. He will face an internal corruption probe launched by the recently upgraded military disciplinary commission within the powerful CMC. If confirmed, Qu’s downfall would be the latest in a string of graft probes launched into the activities of senior officers in recent weeks ahead of the PLA’s anniversary on Monday. The South China Morning Post reported earlier this month that General Tian Xiusi, 66, a former PLA Air Force political commissar and an ally of disgraced former military chiefs Guo Boxiong and Xu Caihou, was put under investigation for alleged corruption. The report was later confirmed by Xinhua.Guo and Xu were snared in President Xi Jinping’s three-year-old anti-corruption campaign after it was extended to the military. Former top PLA general Guo Boxiong jailed for life over graft Guo, 74, the top general under former president Hu Jintao, was sentenced to life in prison for corruption by a military court last Monday. Xu, Hu’s No 2 general, died of cancer last year aged 72 and never stood trial for graft. Qu, a former deputy chief of the Combat Operation Department of the PLA’s General Staff Headquarters, was appointed to his present job in January following a massive organisational overhaul. He was a protégé of retired general Ge Zhenfeng, a former deputy chief of general staff and a key member of the “northeast army” led by Xu. It was not clear what prompted the investigation into Qu but sources said it was probably linked to his previous stint as head of a unit in charge of military equipment under the General Staff Headquarters No 5 department, which oversees information technology. Former top officer in China’s air force ‘under investigation by anti-corruption officials’: sources In addition to the anti-graft campaign, Xi has also spearheaded a major overhaul of the PLA and established 15 new units under the CMC, including the Joint Staff Department, in the last year. In a move widely seen as consolidating his control over the military, Xi also launched a major reshuffle of the military’s top brass and promoted dozens of officers to full general and major general over the past few years. Yi Xiaoguang, a deputy chief of staff of the Joint Staff Department, and Zhu Fuxi, the Western Theatre Command’s political commissar, were promoted to full general on Friday.” http://www.scmp.com/news/china/diplomacy-defence/article/1997337/chinese-graft-busters-take-aim-another-pla-general

China Activates Four Lighthouses In South China Sea. Aiswarya Lakshmi, Marine Link. “Four out of five lighthouses planned for use in the South China Sea have been activated to boost navigation and the fifth lighthouse will be completed and put into use soon. China started to build lighthouses in the South China Sea in May last year, with four now in use on Huayang, Chigua, Zhubi and Yongshu reefs. The most recent project went into operation on Yongshu Reef on June 25. "The five lighthouses are important public service facilities in the South China Sea. Construction and operation of the lighthouses reflects China's dedication to its responsibility of boosting navigational safety in the South China Sea, a critical maritime and trade corridor linking the Pacific and Indian oceans," Xu Ruqing, head of China's Maritime Safety Administration, said at a press conference of the China Maritime Forum in Ningbo, Zhejiang Province. Xu Ruqing introduced that all five lighthouses are 50 to 55 meters tall and are equipped with the Automatic Identification System and VHF (very high frequency) radio, allowing vessels to receive navigation information and warnings from the lighthouses. According to Xu Ruqing, the lighthouses will serve multiple purposes, including navigation support, maritime search and rescue, fishing, marine disaster prevention and mitigation and lower the risk of oil spills.” http://www.marinelink.com/news/lighthouses-activates413287.aspx

Putin In The Pacific: Why We Should Worry. Daniel Flitton, Melbourne Age. “The alarm should have sounded a couple of months ago when Chinese commentators began quoting Vladimir Putin, that "if a fight is inevitable, go and fight first.” But warning bells are ringing loudly now after China declared this week Russia will send warships into the disputed South China Sea to conduct joint navy exercises. The startling development will bring yet another great power into what has fast become a global flashpoint right in Australia's neighborhood. And you shouldn't be surprised that Australia is seen very much as a player in this growing dispute. Just have a read of a firecracker editorial published in China's state-run Global Times on Saturday, calling for "revenge" after the decision by Foreign Minister Julie Bishop last week to join Japan and the U.S. in calling for Beijing to respect international law. "If Australia steps into the South China Sea waters, it will be an ideal target for China to warn and strike," the paper thundered. "Australia is not even a 'paper tiger,' it's only a 'paper cat' at best." How much you take the Global Times as delivering a not-too-subtle official threat on behalf of the authorities in Beijing – and some in Canberra will interpret it that way – or just a shrill bluff really depends on how you judge China's intentions One thing is certain, as defence hardheads well know, is that if China really did think Australia was no more significant than a "paper cat,” they wouldn't feel the need to say so. Australia has resisted calls to follow the U.S. lead and dispatch its own navy ships inside the sensitive 12-mile zone around China's artificial islands, just to show Canberra will not recognise any claims to sovereignty. It was China's sweeping claim, known as the "nine dash line,” that was declared illegal last month by an international tribunal. But back to Russia, why Putin might feel the need to send his navy to this far distant waterway right now, and how much more complicated this dispute might soon become. As Marina Tsirbas from the National Security College in Canberra observes, Russia is looking for any excuse to give the U.S. a "poke in the eye.” Remember Putin made a dramatic intervention into the Syrian conflict last year by sending Russian fighter jets to bolster the failing regime of Bashar al Assad, much to the annoyance of the White House. This promised naval deployment of Russian ships to the South China Sea also comes as a surprise, although Moscow has always insisted it should be seen as an "intrinsic" Pacific power, with a longstanding navy port in Vladivostok. Russia has conducted navy drills with China elsewhere, and made a point of dispatching a small fleet of powerful warships off the coast of Australia when Putin's came to Brisbane in the "shirtfront" days after MH17 was shot down. "China and Russia increasingly find themselves backing one another up when one of them is in confrontation with the West," says Michael Wesley, a foreign affairs specialist with the Australian National University. Wesley doubts the two powers will forge an alliance – "they are not going to go to war for each other" – but may have moved beyond mere ties of convenience. Yet Russia is not the first country to hold navy drills with China. The Royal Australian Navy conducted live fire exercises with the Chinese navy a couple of years ago, drills that admittedly occurred in waters much further north, outside the South China Sea. How significant this latest Russian intervention turns out to be really depends on the warships sent, how long they stay, and what they do. A spokesman for Defence Minister Marise Payne said: "we expect that all parties will conduct themselves in accordance with international law." Russia's presence might be more for symbolism than practical support, but either way, the crowd on troubled waters is growing.” http://www.theage.com.au/world/experts-wary-about-chinas-new-coziness-with-russia-in-the-south-china-sea-20160730-gqh99x.html

After The South China Sea Ruling, Time For More FONOPs. Joseph Bosco, The Diplomat. “In its courageous and comprehensive decision on the South China Sea, the arbitration tribunal appointed by the Permanent Court of Arbitration has rendered an invaluable service to the region and the international community. It has established an international law overlay to China’s sweeping territorial and maritime claims and thereby provided important guidance for all six competing claimants. Hopefully, the decision will be a wake-up call for China’s leaders—a deus ex machina that opens a way out of the predicament they have created for themselves. China is at a decisive point in its history. It can continue on the path of defiance and disdain toward the international legal system and return China to the kind of angry isolation Richard Nixon described in 1967: a China “outside the family of nations, nurturing its fantasies, cherishing its hates, and threatening its neighbors.” Or Beijing can man up, swallow a little pride, and win accolades of international praise, respect, and appreciation by accepting the tribunal decision and working cooperatively within ASEAN and other regional institutions for the peaceful accommodation of every country’s interests. Foregoing China’s sweeping maritime claims would also eliminate the potentially confrontational aspects of America’s FONOPS in the South China Sea, highly constrained as they have been so far. Beijing’s claims are no longer even historically colorable after the tribunal’s sweeping findings and rulings. But whether China cooperates or not, the arbitration decision affords the United States a unique opportunity to correct its own earlier mistakes in ensuring navigational freedoms. For two years, China dredged sand from the sea bottom, piled it onto rocks and reefs, and built artificial islands to fill in the dashes in its nine-dash line claim to virtually the entire South China Sea. Contrary to Xi Jinping’s representations to President Barack Obama at their California summit last year, China continued to construct runways and military facilities on those newly-created land features. All the while, American officials joined others in protesting China’s expansionist actions while standing passively by. Last October, the United States finally moved to assert its right of freedom of navigation by dispatching the USS Lassen within twelve nautical miles of five features in the Spratly Islands claimed by China. In January, the Curtis Wilbur did the same off Triton Island in the Paracels, and in May the William Lawrence steamed within twelve nautical miles of Fiery Cross Reef in the Spratlys. All three ship transits were intended to enforce the claims by Secretaries Ash Carter and John Kerry and other officials that “the United States will fly, sail, and operate anywhere that international law allows”—but all three failed to meet the operating part of that standard. While technically freedom of navigation operations (FONOPS) within Washington’s very broad definition, they deliberately did not challenge China’s sovereignty claims, only the “requirement” of notice. All three limited FONOPS were merely exercises of innocent passage, a law of the sea concept that applies to transits within a country’s implicitly acknowledged territorial waters. By deactivating their radar systems and avoiding exercises or tactical maneuvering, the U.S. Navy ships did not act as if they were operating on the high seas as Washington claims it is doing. China protested anyway but must have welcomed the unintended territorial concessions. Now that the tribunal has demolished even the patina of China’s legal/historical claims to the international waters of the South China Sea, Washington should act as decisively and confidently as did the brave jurists on the tribunal. Beijing should accept regular, unconstrained FONOPS not as provocations but as the normal routine on the high seas as affirmed by the arbitral tribunal.” http://thediplomat.com/2016/07/after-the-south-china-sea-ruling-time-for-more-fonops/

Tsai To Apologise For Injustices To Taiwan’s Aboriginals But Threats To Way Of Life Abound. South China Morning Post. “For Tama Talum of Taiwan’s aboriginal Bunun mountain people, hunting is a way of life, integral to his tribal customs – but after his arrest for illegally killing a deer and goat on land near his village, he fears those traditions will die out. It is just one of many cases reflecting the wrangle between Taiwan’s authorities and its indigenous people, with critics arguing laws discriminate against aboriginal culture. Tsai Ing-wen – the first Taiwanese leader with aboriginal blood – will attempt to ease those tensions when she delivers the first apology to the island’s indigenous people on Monday for injustices over the centuries. “An apology isn’t going to solve all the problems, but symbolically it shows Tsai is willing to face this issue,” said Kolas Yotaka, a legislator of the ruling Democratic Progressive Party (DPP), who is from the largest Amis tribe. She added: “It gives us hope.” However, for Talum, the damage is done. The 57-year-old is a free man while he awaits the result of an appeal at the Supreme Court after an uproar in the aboriginal community over his 3½ sentence for possessing an illegal weapon and hunting protected species. Aboriginal hunters are legally only allowed to use home-made guns – which are said to be dangerous and have led to injuries – and to hunt on festival days, restrictions to which many tribespeople object. Talum’s arrest has stopped younger tribe members wanting to hunt, he said. “Some of them are scared after seeing me being dragged away. They don’t want to learn. I was an optimistic man but it’s hard to be upbeat,” he said. Their sense of injustice revolves around the loss of ancestral land rights, which came under threat when immigrants from the mainland arrived 400 years ago. Much of that land is now national park, leading to clashes over hunting and foraging in areas where permits are needed. “There are so many restrictions, telling us what we can’t do,” Talum said. “We aren’t stealing or robbing anyone, and it’s not that we are hunting everyday.” Talum moved to the city in search of work, but eventually returned to take care of his mother. Aboriginal unemployment is higher than the rest of the workforce and their wage is about 40 per cent less than the national average, according to the government’s Council of Indigenous Peoples. A lack of autonomy to manage and live off their land also exacerbates social issues such as alcohol abuse, according to Scott Simon, a professor at the University of Ottawa, who researches Taiwan indigenous rights. “The alcohol problem is a major public health issue that is not being adequately addressed. These issues are related,” he said. Despite the challenges, some young aboriginals are trying to reconnect with their roots. “What we want is simple: give us back what was originally ours,” said Kelun Katadrepan, who works for an indigenous television station. The 30-year-old from the Puyuma tribe has started a campaign group gathering young professionals to advocate aboriginal involvement in politics. In addition to restoring dispossessed land, Katadrepan wants an overhaul of the education system to prevent further loss of tribal languages five are seen as “severely endangered” by Unesco. His parents did not want to teach him their native language while growing up, believing he needed to master Putonghua to secure a better future. “We aren’t Chinese, but we are forced to learn Chinese since we are little. That is not our culture,” Katadrepan said. But there have been gradual efforts to change that. While teaching is usually in Chinese, some schools offer options to take native language classes. There are also indigenous community colleges where traditional customs and skills are taught. With the DPP now in power, legislator Yotaka hopes government regulations will now be brought in line with the aboriginal basic law, adopted in 2005 to protect indigenous rights. That would correct current contradictions, including the fact that hunting is illegal apart from during major tribal festivals – even though the basic law protects indigenous rights to kill wild animals for self-consumption. Talum says he has not risked hunting since his conviction, except for a sanctioned foray during a spring festival where young Bunun men demonstrate their hunting skills and pray for a good millet harvest. He still clings on to hope that his son, who was raised in the city and is now in his thirties, will eventually learn the old ways. “After a while, when the time comes, he will think of going to the mountains with his father,” he says. http://m.scmp.com/news/china/policies-politics/article/1996678/tsai-apologise-injustices-taiwans-aboriginals-threats

Chinese Tech Giant LeEco To Acquire Vizio For $2 Billion. Nyshka Chandran and Anita Balakrishnan, CNBC. “China's LeEco plans to acquire Vizio for $2 billion—a move that will create a global television powerhouse and help cement the tech giant's presence in the world's largest economy. Tuesday's deal will "lay a great foundation for LeEcco in the U.S. and global market," LeEco founder and CEO Jia Yueting told CNBC's "Power Lunch" on Tuesday, in an interview that was translated from Chinese. Tuesday's news was the latest indicator of LeEco's forceful expansion into the U.S. Last month, LeEco poached a senior legal counsel from Google and purchased Yahoo's Silicon Valley property following its April unveiling of an 80,000-square-foot production factory in San Jose. LeEco is also due to launch its smartphones in the U.S. later this year, according to media reports. Jia said he plans to fund international expansion through a combination of equity financing and cash flow from the firm's seven sub-ecosystems. Previously known as LeTV, the company has gone from being primarily a video streaming service—it's well-known as the Netflix of China—to a diversified conglomerate with a product range that includes smartphones, televisions, mountain bikes and, most recently, electric vehicles. Under the terms of the deal, Vizio's hardware and software businesses will be owned and operated as a wholly owned subsidiary of LeEco, while the Vizio's data business, Inscape, will spin out, the companies said in a statement. The deal is expected to close during the fourth quarter of 2016, the companies said. Privately-held Vizio is one of North America's leading consumer electronics brands, known especially for its line of smart TVs. "I'm excited to see how LeEco's global reach and resources will elevate Vizio," William Wang, founder and CEO of Vizio, said in a statement. Analyst reaction to the $2 billion price tag was mixed. Bob O'Donnell, founder and chief analyst of TECHnalysis Research, called the figure "high" and reflective of just how important U.S. expansion was for LeEcho. On the other hand, Bradley Gastwirth, CEO of equity research firm ABR Investment Strategy, believed the price was fair, noting that the deal also offered LeEcho access to Vizio's data business, Inscape. "Inscape will still be owned 51 percent by William Wang, with the remaining 49 percent by LeEcho," Gastwirth said. Jia, who in the past has criticized Apple for its lack of innovation, said on Tuesday that he believes Chinese and U.S. companies can become "very good friends." His comments come amid a wave of controversy regarding China Inc's expanding presence in the U.S. Chinese investment in the U.S. rose to a record high last year as companies embarked on an aggressive shopping spree amid a worrisome domestic backdrop of volatile stocks, a depreciating renminbi and a marked economic slowdown. "Like we always say, LeEco looks like an enemy to all, but actually we are the best ecosystem partner for everyone," Jia said. He wishes to cooperate with U.S. tech rivals such as Amazon and Netflix, noting that "they can all become very good friends." "In the U.S. our model is an open content ecosystem, so we want to open our cloud platform, e-commerce platform, big data platform, software, and hardware to our partners, so there is good opportunity for us to cooperate..." For U.S. consumers, this acquisition should bolster the visibility of LeEcho's brand name seeing the Chinese conglomerate remains unknown to many Americans, commented Gastwirth.” http://www.cnbc.com/2016/07/26/chinese-tech-giant-leeco-to-acquire-vizio.html

Thailand 'Full of Chinese Agents,' No Longer Safe For Chinese Refugees. RFA News, Qiao Long. “Chinese political refugees in Thailand, many of whom smuggled themselves across Southeast Asia to escape persecution by the authorities back home, say the country is no longer a safe haven for dissidents, as the Thai authorities seem increasingly willing to hand them back over to Beijing. Several Chinese asylum-seekers—some of whom were recognized by the United Nations as genuine refugees—have been deported for immigration violations, throwing the expatriate dissident community into a state of constant fear, some told RFA in recent interviews. "The Thai government began an operation to round up any foreign nationals who have overstayed their visas," Wu Yuhua, a rights activist who escaped to Thailand more than a year ago, told RFA. "This means that the Chinese refugees are now living in constant fear, every day," she said. "We fear that one day, it'll be us who gets taken in." Thailand is no longer the safe haven it once was for Chinese dissidents fleeing persecution, according to Wu and many others like her. "It's not so much being locked up in immigration detention. That's not so bad, but if we get repatriated, we will definitely wind up in jail," Wu said. Some rights activists never even make it as far as Thailand, she said, citing the case of Liu Jiaqing, who was arrested by police in Myanmar. "I heard recently he was sentenced to two years' imprisonment," Wu said. Those who do get to Thailand face the constant threat of detention, as well as official retaliation against loved ones back in China, she said. Chinese activists in Thailand now face being followed and watched on a regular basis by personnel hired by the Chinese government, refugees say. "The following, the surveillance, the monitoring: all of this makes it much more risky," Yu Yanhua, who fled persecution in his hometown of Xuzhou, in the eastern Chinese province of Jiangsu, told RFA. "I don't dare go back to where I am living; I'm too frightened," Yu said. "There is nowhere safe to hide.” Fellow asylum-seeker and former Henan rights activist Xing Jian said Thailand now seems to be full of Chinese agents. "People get suspicious if you ask after them, because China has sent a huge number of agents to Thailand, planting them among the refugees and messing with their relationships," he said. "The refugees here have very few dealings with one another now, even at the UNHCR," Xing said. "Even if we see them there, we won't go over and greet them." Zhang Wei, from the southwestern Chinese province of Guangxi, said he was followed by suspected Chinese agents when he helped organize an event commemorating the 1989 Tiananan massacre. "There were three suspicious-looking people there," he said. "They looked exactly like Chinese state security police, to judge from the way they were dressed." "Somebody even went to the home of [Thailand-based refugee] Li Xiaolong and tried to visit him," he said. Thailand-based dissident Liu Xuehong said the Chinese agents are busy eroding any support for refugees, either among each other or from supporters in Thailand. "Their aim is to obstruct us, and to stop us from speaking out," Liu said. "Even the U.N. High Commission for Refugees (UNHCR) is concerned about our safety." Last November, Chinese asylum seekers Jiang Yefei and Dong Guangping, who had fled persecution in their home country, were handed back to Chinese authorities in a move that drew strong criticism from the U.N. at the time. They are now in pretrial detention in the southwestern city of Chongqing. "We call on the U.N. to speed up our applications for resettlement as refugees so that we can live life like normal human beings," Liu said. The fear of meeting a similar fate has left many Chinese asylum-seekers in serious financial difficulties, he said. "Some people are reduced to eating waste or leftover food, or rely on friends to live," Liu said. "There isn't much support in place, and the UNHCR is overwhelmed by too many international refugees." Earlier this month, Zhao Changfu, a prominent rights activist from the eastern Chinese province of Jiangsu, skipped bail for subversion and fled through mountains and jungle, using Google Maps as a guide. Liu said that he and Zhao were followed by an unidentified person when they went to the UNHCR to process Zhao's asylum application. "It was just one person, following us ... The security situation hasn't been quite right since Zhao Changfu arrived," he said.” http://www.rfa.org/english/news/china/agents-07292016113331.html

Will China Upstage The U.S. At The November APEC Summit?Evan Ellis, Latin America Goes Global. “When I visited Beijing, China from July 16-31 of this year, it was the high point of summer both in Washington D.C. and Beijing; focused more on the sweltering heat and impending vacations, I wasn’t ready to think about the fall and winter. But my Chinese colleagues were already focused on the November Asia-Pacific Economic Cooperation (APEC) leaders’ summit. APEC started in 1989 as a forum for Pacific Rim countries to promote free trade. The annual summit of member heads of states, which currently includes 21 countries, has become one of the most important high-level forums for countries on both the Asian and Latin American sides of the Pacific. Although the APEC leaders’ summit rotates among member countries, this year’s meeting in Lima, Peru will be the first time in eight years that the event has been held in Latin America. The past two gatherings in Latin America (2004 in Santiago, Chile, and 2008 also in Lima), highlighted the region’s growing commercial relationships with Asia and showcased major new trade initiatives between the People’s Republic of China (PRC) and the region. In my conversations with my colleagues from Chinese companies and academia, I realized how important this particular event will be for the PRC, the U.S. and the region—not just for the issues on the table for discussion but even for the symbolism and side discussions that will occur. On the PRC side, between President Xi Jinping and Prime Minister Li Keqiang, since March 2013 (when Xi assumed the presidency) Chinese state leaders have made at least one trip per year to Latin America—with each featuring multiple stops and important policy announcements. In May 2013, just two months after assuming the Chinese presidency, Xi demonstrated his interest in the region by visiting Costa Rica, Trinidad and Tobago, and Mexico, meeting with a total of 11 heads of state from the region before arriving in Sunnylands, California to meet with U.S. President Barack Obama. In July 2014, Xi traveled to Venezuela, Cuba, Argentina, and Brazil in a conjunction with that year’s annual BRICS summit in Fortaleza, Brazil. The tour through the region provided the Chinese leader the chance to showcase multiple new initiatives toward the region, including the PRC’s new “1+3+6” approach to building its relationship with the region, referring to one plan, three engines (trade, investment and finance), and six fields (energy and resources, construction of infrastructures, agriculture, manufacturing, scientific and technological innovations and information technologies), and highlighting $35 billion in new loan funds promised for the region. In May 2015, Prime Minister Li Keqiang visited Brazil Colombia, Peru and Chile, affirming $27 billion dollars in deals during his stop in Brazil alone. Although the Latin American countries that President Xi will visit this November en route to APEC have not yet been announced, the trip will likely be the centerpiece of PRC diplomacy toward Latin America this year. The combination of a U.S. administration focused on the November presidential elections, and a region in need may make this year’s APEC leaders’ summit in Lima a triumph for Chinese diplomacy toward Latin America. In 2004, President Hu Jintao’s trip to that year’s APEC summit in Santiago, Chile, put the PRC on the map for Latin America’s mainstream business and political leaders, with his talk of $100 billion in Chinese investment or trade with the region within the next 10 years. President Hu’s show-stealing presence at the 2004 APEC summit was due in part to the U.S.’s relatively weak showing. Then-President George Bush arrived at the event distracted by events in other parts of the world and brought to Santiago an agenda out of step with most Latin Americans’ interests: North Korea’s efforts to obtain a nuclear weapon, the strong U.S. dollar, and U.S. budget deficits. In 2004, like now, Latin America was looking for answers to its economic challenges. By the time of the Santiago summit, Latin America had suffered several years of falling foreign direct investment as Western capital increasingly flowed to the PRC and other Asian destinations. Latin American heads of state arrived at the meeting looking for new answers to the challenges of development. Similarly, this year, Latin American economies (particularly in South America), have been reeling from low global prices for commodity exports. This year alone, the region is expected to contract up to 1.3 percent, dragged down largely by the economic crises in Brazil and Venezuela. This year’s summit will occur on November 19-20, just 11 days after the U.S. elections. In the lead up to the Lima gathering, White House staffers and senior U.S. policymakers will likely be distracted by the election, leaving little time to focus on preparation. In addition, President Obama will arrive in Lima as a lame duck, scheduled to leave office January 20, 2017, two months after his appearance at APEC. His appearance will largely be a farewell and an attempt to define and consolidate his legacy, meaning there will likely be only a few—if any—new initiatives. The APEC leaders’ summit will also be the first major gathering of global leaders after the U.S. elections reveal the next president. As such, the conversations on the sidelines of the summit will be as important as the event itself. Given that both U.S. presidential candidates, Hillary Clinton and Donald Trump, have indicated opposition to the Trans-Pacific Partnership in its current form, the leaders gathered in Lima will likely be looking for signals whether the initiative, signed in Auckland in February 2016, will now wither away without the required approval by the U.S. Congress. If the conclusion is that it will die on the vine, the big question will be “where do we go from here?” In such a vacuum, China’s President Xi would likely push for his country’s own trade initiative, the Regional Comprehensive Economic Partnership (RCEP), as an alternative path to free trade. Yet because the RCEP does not currently include Latin America, moving down this path would likely be a major setback for trans-Pacific economic integration. By contrast to the TPP, the less stringent terms of RCEP, focusing principally on free trade rather than supporting issues such as intellectual property protection, would represent a loss to the U.S. and like-minded partners to define the emerging regime of the Pacific in a fashion congruent with Western interests. If Hillary Clinton wins the election, the assembled leaders in Lima will likely be looking at rumored members of her new cabinet for clues about likely continuity and change regarding U.S. economic and security policy toward Asia. Particular focus will be given to how hostile President Clinton’s policy might be toward the PRC, and how the U.S. level of attention toward Asia and security commitments to Asian states might evolve. If Donald Trump is elected, APEC will be the first high-level forum in which state leaders can evaluate the possible dramatic shifts in the Asia-Pacific’s economic and security environment. Trump’s declared intention to revisit both the TPP and U.S. membership in the North American Free Trade Agreement (NAFTA) could spawn wide-ranging discussions at the summit regarding how to re-work trans-Pacific trade integration without the United States. If it’s felt that U.S. focus on free trade and TPP will likely diminish in the next administration, the summit may also serve to re-energize interest in the Pacific Alliance as a non-US alternative. This year’s host, Peru is a founding member, as a Pacific-oriented, pro-market, free-trade-oriented organization to integrate pro-market Latin American economies independent of the United States. In the security realm, Trump’s announced intention to force U.S. allies to bear a greater share of regional security burdens and to support Japan’s development of nuclear weapons may prompt the countries of the region to rethink their response to the perceived threat of PRC expansionism in the South and East China Seas. Yet participants will also be wondering under what circumstances a Trump administration might unexpectedly intervene, in economic or other fashion, if the combative, thin-skinned president-elect feels offended. ven without a Donald Trump victory in the November, Asian security issues will be a backdrop of the summit, with China continuing to construct island military bases and otherwise assert its territorial claims in the South and East China Seas. My Chinese colleagues reassure me that the PRC government will likely attempt to calm tensions prior to the summit, so that it does not distract from other issues the PRC wishes to discuss. But, given the PRC’s recent actions, the other governments of the region are not likely to simply let the matter go. While it’s impossible to predict the specific topics that China will push on the agenda at the summit, it will probably use the occasion to highlight its most important Asian initiative, One Belt One Road (OBOR) along with supporting Asia Infrastructure Investment Bank (AIIB). By the time of the summit the AIIB’s first projects will have gotten off the ground. With respect to initiatives in Latin America, the PRC may take a new step forward with the multilateral loan funds it has set up through China Development Bank and China Import-Export Bank, which, to date, have not disbursed any funds. While it may not be in a position to announce new progress on Peru-Brazil inter-oceanic railroad, which remains stuck in the study phase, it’s also likely that China will showcase one or more headline-capturing new projects in the region. As with prior summits, President Xi will probably also use the gathering to conduct bilateral meetings with Latin American leaders that he could not visit en route to Lima. This will include Chile’s president Michelle Bachelet and Peru’s newly elected President Pedro Pablo Kuczynski. Given China’s lingering frustration over the Mexican government’s cancellation of the Mexico City to Queretaro high-speed railroad just before the 2014 APEC summit in Beijing (and, just for good measure, a second time months afterward), a meeting between President Xi and Mexican President Enrique Peña Nieto is not guaranteed. But a side meeting would indicate that the PRC is ready to smooth over past differences. It is possible, yet doubtful, that President Xi will include Ecuador and Bolivia as stops en route to Lima. While the level of Chinese business in each country and its good relations with their current regimes makes them logical candidates for a visit, China has not, to date, deemed either a “strategic partner” meriting such attention. A visit by President Xi to either country could indicate that they are being “elevated in importance” by the PRC among ALBA countries in the context of the implosion of Venezuela, as part of China’s evolving strategy toward the region. Beyond China, the summit will be an opportunity for Russian President Vladimir Putin to travel to the region. While traditional Russian allies in Latin America such as Nicaragua, Cuba and Venezuela will not be present in Lima, Putin’s presence, and any other Latin American stops he makes en route, will be Russia’s first public statement regarding the current state of its intentions toward Latin America in the wake of the U.S. elections. Finally, the APEC leaders’ summit in Lima will also showcase the new government of Pedro Pablo Kuczynski. As when Peru last hosted the 2008 summit, this year’s gathering will allow the host to highlight its role as a destination for Asian investment, its importance as a trading partner, and its potential role as a nexus for trade between Latin America and the rest of the region. It will also call attention to Kuczynski’s high caliber economic team, and the return of the political pendulum in Latin America back toward governments that favor free trade and a market-based approach to development. For the U.S., the November summit represents a complex challenge that should not be ignored. A generation from now, the Obama administration’s much-discussed “pivot to Asia” will be remembered for how he left it at APEC, as he transitioned out of office. Whoever wins the U.S. election in November, members of the incoming president’s policy team should accompany the official delegation to Lima, both to provide indications about U.S. intentions and to hear the thoughts and concerns of the leaders assembled at the summit. Although such coordination may be particularly improbable if Donald Trump wins the election, it should nonetheless be considered for the greater good of America’s standing among its international partners and for launching the incoming administration in the best possible fashion. Both the current administration and the incoming team must come to the APEC leaders’ summit prepared to talk about the path forward in a way that is relevant to the economic and security concerns of both Latin America and Asia. That includes the United States and the PRC and other powers such as Russia that will be at the table. Even if an incoming U.S. administration intends to revisit the trade and security commitments that bind the U.S. to the region, it must make clear that such policy changes do not change the enduring bonds of geography, commerce and family that connect the U.S. both to Latin America, and to its neighbors across the Pacific. Most of all, it must show that the U.S. presence in the Asia-Pacific strategic and economic environment are core to its national interests and vision for the future.” http://latinamericagoesglobal.org/2016/07/will-china-upstage-u-s-november-apec-summit/

Russia To Join Chinese Drills In Sea Zone Under Dispute. Chris Buckley, The New York Times. “Russian naval forces plan to join Chinese forces for a joint exercise in the South China Sea, highlighting Moscow’s partnership with Beijing after a recent international legal ruling underlined rifts between China and Southeast Asian nations over rival claims across the sea. The joint exercise will be held in September, a spokesman for the Chinese Ministry of National Defense, Senior Col. Yang Yujun, said in Beijing on Thursday. But he gave no details about the size of the drill or precisely where it would take place in the vast stretch of sea from southern China nearly to the Philippines. “Following a joint understanding reached between China and Russia, the navies of the two countries will hold a joint military exercise in the relevant sea and air areas of the South China Sea in September under the name Joint-Sea 2016,” Colonel Yang said. The drill was not aimed at any other country, he said. But he also said that the experience gained would “enhance the capacities of the two navies to jointly respond to maritime security threats.” On July 12, the Permanent Court of Arbitration in The Hague decisively rejected Beijing’s expansive claims to sovereignty across the South China Sea, where China has been building artificial islands and consolidating its control of disputed areas. Beijing refused to take part in the case brought by the Philippines, and Chinese officials and state media have pilloried the decision and suggested the United States was somehow to blame. The Philippines has been especially worried that China will start building islands on the Scarborough Shoal, about 220 miles northwest of Manila. But several experts said that the joint naval exercise would probably serve more as a show of partnership at a tense time than as a substantive military shift in the area. “It is premature to draw a definitive judgment,” said Bonnie Glaser, the director of the China Power Project at the Center for Strategic and International Studies in Washington. “My inclination is to view this as one of a series of Chinese reactions to the ruling that can demonstrate the Chinese Communist Party’s resolve to defend Chinese sovereignty and thus fend off pressure from the public and the military.” “In my view, however, the China-Russia exercise is not necessarily a departure from what has so far been a pattern of relative restraint” in China’s reaction to the Permanent Court of Arbitration’s ruling, she said. Whether Russian participation in the joint exercise would add more than symbolic support to China’s position over the sea disputes remained unclear, said M. Taylor Fravel, a scholar at the Massachusetts Institute of Technology who studies China’s military forces and its multiple maritime disputes. “The key question will be where in the South China Sea the exercise occurs,” he said. The two countries might hold their exercise close to Guangdong Province in southern China, or Hainan, a Chinese island-province that extends into the sea. That would be a less contentious site. Or they might hold them near the disputed Spratly Islands, which would be more likely to alarm neighbors, Mr. Fravel said. China and Russia have a long history of friction and mutual suspicion over their own territorial disputes. But they have been trying to strengthen military and security cooperation, and joint Chinese-Russian naval exercises have become increasingly frequent since 2005. China’s president, Xi Jinping, has, like his predecessor, Hu Jintao, striven to build a close relationship with President Vladimir V. Putin of Russia. In June, Mr. Xi and Mr. Putin issued a joint statement on “strengthening global strategic stability” that stressed their shared views on many issues. “China and Russia should support each other on issues concerning core interests,” Mr. Xi said at the time. In public, Russian officials have said they support negotiated solutions to the disputes in the South China Sea, but they have not given a full-throated public endorsement to China’s rejection of the international court’s decision. This drill will not be the first time that China has displayed its partnership with Russia by holding sea exercises. China is locked in a longstanding dispute with Japan over claims to islands in the East China Sea. Last year, China and Russia held joint drills in the Sea of Japan, and a year before that in the East China Sea. But the exercises did not enter waters around the disputed islands.” http://www.nytimes.com/2016/07/29/world/asia/russia-china-south-china-sea-naval-exercise.html

America’s Philippines Blunder. Greg Rushford, The Wall Street Journal. “U.S. Secretary of State John Kerry on Wednesday discussed the “full range” of economic and security issues with Rodrigo Duterte, the Philippines’ newly elected president. The visit comes in the wake of The Hague’s July 12 ruling that Chinese actions in the South China Sea violate Philippine rights. Mr. Kerry’s diplomatic mission was to assure Mr. Duterte that Manila can count on Washington’s mutual-defense promises. But there are also Mr. Duterte’s doubts that the U.S. can support the Philippine trade and economy. When Mr. Duterte was sworn in to office on June 30, U.S. Trade Representative Michael Froman announced a new trade policy that upends important economic growth plans in the Philippines. It threatens to wipe out an estimated $100 million annual boost to Philippine exports of travel goods such as luxury handbags, wallets and backpacks. It also complicates Philippine investment aspirations to create some 75,000 travel-goods-related jobs in the next five years. At first glance, Mr. Froman’s announcement gives no hint of the economic controversy it has sparked. He says that President Obama wants to make “a powerful contribution to lifting people out of poverty and supporting growth in some of the poorest countries in the world, while also reducing costs to American consumers and businesses.” The policy benefits 43 least-developed beneficiary countries, such as Cambodia and Haiti, and 38 African nations. Pursuant to the U.S. Generalized System of Preferences (GSP) program, these countries will no longer have to pay stiff tariffs of up to 20% on handbags, wallets and other travel goods exported to the U.S. The U.S. decision to give preferential treatment to the industry’s small players, while blindsiding the most competitive producers, is perplexing. Cambodia, for instance, holds a modest 0.4% of the U.S. market, producing mostly backpacks. Africa’s total travel-goods exports to the U.S. amount to roughly one hundredth of one percent market share. As a result, the policy gives just two countries—China and Vietnam—a combined 90% share of the $5 billion U.S. travel-goods market. It is unlikely that preferential treatment will prompt least-developed countries to boost their exports. Even with 15 years of duty-free access to U.S. clothing markets under the African Growth and Opportunity Act, 40 African countries combined to export less than 1%, or $1 billion, of garments each year to the U.S. The Philippines alone exceeds Africa in clothing exports by more than $100 million. Diplomats from other countries and industry giants in the U.S., such as Coach, Columbia Sportswear and Kate Spade, have written to Mr. Froman asking for an explanation. On Wednesday 14 members of U.S. Congress, including 10 from the powerful Ways and Means Committee that has jurisdiction over trade, also issued a strong letter to the U.S. trade chief. But Mr. Froman has yet to offer any economic rationale for the decision, nor is there any evidence on the public record to support it. Developing countries with larger market shares of the travel-goods industry, such as India, Indonesia, Pakistan, the Philippines, Sri Lanka and Thailand, must now reconsider their plans to expand their investments. Major U.S. players such as Coach and Michael Kors, which looked to U.S. trade officials to provide financial incentives to shift production away from China, will now put those investment plans on hold. China is thus poised to keep its 85% share of the U.S. travel-goods market. Vietnam, as a communist country, is not eligible for the GSP preferences. But in the Trans-Pacific Partnership trade deal, the U.S. agreed to give the Vietnamese—who now hold a 5% market share—the same duty-free treatment withheld from GSP-eligible countries. Pakistan’s Prime Minister Nawaz Sharif thought he had received assurances directly from President Obama last year that U.S. trade officials understood the “importance” of increasing enhanced market access for Pakistan’s GSP-covered exports. Diplomats I have spoken to chafe at the unfairness. Viewed through the Philippine lens, the failure to connect economic cooperation with the security aspect of Obama’s pivot to Asia is glaring. Cambodia, apparently thanks to financial inducements from Beijing, has been the spoiler whenever the Philippines has sought solidarity from its partners in the Association of Southeast Asian Nations in standing up to China in the South China Sea. Asked repeatedly for his side of the story, Mr. Froman asserted through a spokesman that “travel goods are a product particularly well-suited to be produced in least-developed countries.” He declined to explain further. While the broader security relationship will survive, it is worth noting that in international economic diplomacy, like in personal relationships, unnecessary smaller slights erode trust. With the Chinese watching on the sidelines and eager to buy their way out of their South China Sea mess, this is not a wise time to rub the volatile new Philippine leader the wrong way.” http://www.wsj.com/articles/americas-philippines-blunder-1469724370

Crackdown on Hong Kong's Dissident Publications Continues. Cal Wong, The Diplomat. “In the continued persecution of those who criticize and make fun of the Chinese leadership, in particular Xi Jinping, China has continued to pursue and imprison Hong Kong journalists. Echoing the recent case of the five missing booksellers, another two Hong Kong journalists, who had business operations based out of Hong Kong, have been arrested in China’s Shenzhen, where they were residing at the time of arrest in May 2014. The pair were charged for running an illegal business, the very same charge imposed on the five abducted booksellers last year. Their Hong Kong-registered company, National Affairs Ltd, published two magazines largely based on rumors and gossip about those in the upper echelons of the Chinese government. It also frequently carried reports on the power struggles within the Communist Party of China, according to the Hong Kong Journalists Association (HKJA). Publisher Wang Jianming was sentenced to five years and three months in prison, while editor-in-chief Guo Zhongxiao was slapped with a sentence of two years and three months. Both pleaded guilty in the Shenzhen Nanshan District People’s Court last year. The two were prosecuted on the grounds that they sold banned material to Chinese nationals, despite the fact that only eight Chinese nationals were actual customers (and friends of the publisher) and that the business is registered and based in Hong Kong, a technically separate territory with its own laws. Wang’s lawyer argued that under “one country, two systems” there was nothing illegal in his client’s business. Nevertheless Guangdong’s print and broadcast regulator said the magazines were “illegal publications” that were not registered in mainland China, but were sold to Chinese readers. Under Chinese law, illegal business operations that lead to less than RMB 250,000 ($37,500) in proceeds would result in a jail term of less than five years. The defense argued that the illegal portion of the business (the mainland readers) accounted for only RMB 60,000 ($9,000) of the total revenues. However, in a rare occurrence even by Chinese standards, the judge chose to ignore these figures and instead ruled on the HKD 7 million ($902,500) in total revenues. The Independent Commentators Association and HKJA are worried that the mainland authorities are selectively suppressing targeted or sensitive publications on the “pretext of law” in order to intimidate and silence journalists who travel to the mainland and in turn, erode press freedom in Hong Kong. Hong Kong Journalists Association chairwoman Sham Yee-lan said the Hong Kong government had a responsibility to offer help to its citizens. The Hong Kong Immigration Department said that it had not received any request for help, according to the South China Morning Post. From October of last year, five booksellers, all of whom either worked at or owned Mighty Current Media, a Hong Kong publishing house and bookstore that specializes in tabloid publications on China’s political elite, went missing under mysterious circumstances. The men, of varying nationalities but all of ethnic Chinese descent, disappeared from mainland China, Thailand, and Hong Kong and turned up on Chinese television confessing and asking to be punished for a number of offenses that they had committed over the past 10 years.” http://thediplomat.com/2016/07/crackdown-on-hong-kongs-dissident-publications-continues/

Taiwan-U.S. Security Partnership Facing Chinese Test, Brookings Institution Says.William Lowther, Taipei Times.“The security partnership between Taiwan and the U.S. would be increasingly tested by the continuing modernization of China’s armed forces, the Brookings Institution said in a working paper. “What Taiwan does to ensure its security is also a critical variable,” said the paper, which was written by former American Institute in Taiwan chairman Richard Bush, who is director of the think tank’s Center for East Asia Policy Studies. It is part of a series on Washington’s commitments in the Asia-Pacific region released as the U.S. “election season heats up and campaign rhetoric questioning the value of U.S. alliances overseas has kicked off a furor of debate in foreign policy circles.” The U.S. Republican Party held its national convention last week, while the Democratic Party held its convention this week. “The ability of the People’s Liberation Army [PLA] to project power across the Taiwan Strait and in the East China Sea will only grow,” Bush wrote in the paper. “Despite the ambiguity of public American rhetoric, the capabilities that the PRC [People’s Republic of China] has acquired to complicate any U.S. intervention suggest that it assumes the U.S. will in fact act to defend Taiwan.” Even if the U.S. did come to Taiwan’s aid in the case of a Chinese attack, the “tyranny of distance” across the Pacific Ocean would require Taiwan to survive on its own for an estimated several weeks, he wrote. “That raises the question of whether Taiwan’s defense strategy would buy it enough time,” he wrote. China’s array of ballistic and cruise missiles has created the possibility that the PLA could immobilize Taiwan’s air force by repeated missile strikes on airfields, Bush said. “The Chinese military cannot yet conduct a successful amphibious campaign against Taiwan or execute a tight naval blockade of the island’s ports, but its capabilities are improving systematically and in the process are negating the ROC’s [Republic of China] long-standing defense strategy,” Bush said. “Washington policymakers should probably pull out the dual-deterrence playbook and consider the appropriate mix of warnings and reassurances to Beijing and Taipei in the knowledge that China’s military power will only grow in the years ahead,” he wrote. The paper came as another U.S. expert warned President Tsai Ing-wen that she might need to restrict her supporters who want to promote an “ideological agenda.” Former U.S. Department of State policy planning official Alan Romberg said in an analysis that the most hopeful interpretation of the present situation between Taiwan and China is that a process has begun that could eventually lead to a stable relationship. “For that process to succeed, Tsai will need to rein in enthusiasts in both the executive and legislative branches who may be inclined to see the January election results as giving Tsai and the DPP [Democratic Progressive Party] a mandate to press an ideological agenda,” Romberg said. “And Beijing will have to pull back from its most rigid requirements, allowing interpretation of Tsai’s words and actions to fill the gap,” he said. The analysis, published by California-based think tank the Hoover Institution, said that a general consensus seems to exist both in Taiwan and China that any process to stabilize relations – or decide that is not possible – would take about six months. “While the view in Taipei seems to be hopeful that all will be well by the end of that period, one senses a rather more downbeat expectation on the Mainland [China],” said Romberg, who is now director of the East Asia Program at Hoover’s Stimson Center. “Some people believe that if Tsai does not openly embrace some form of ‘one China’ not just in actions, but also in words, cross-strait relations will take a decided turn for the worse,” he said. “One hopes the more optimistic view prevails, but we will have to wait and see.” http://www.taipeitimes.com/News/taiwan/archives/2016/07/29/2003652018

The Paradox At The Heart Of The South China Sea Ruling. Feng Zhang, Foreign Policy. “On July 12, an arbitration tribunal at The Hague delivered what is widely regarded as a landmark ruling on the maritime territorial dispute between the Philippines and China. Among many breathtaking findings, the tribunal declared China’s so-called “nine-dash line” invalid. It also concluded that none of the Spratly Islands – not even Itu Aba (Taiping Island), the largest naturally formed feature – are capable of generating an Exclusive Economic Zone (EEZ) and continental shelf of their own. On their face, these decisions, which rejected every argument that China made, drastically reduce China’s maritime rights in the Spratly chain of the South China Sea; international observers have almost unanimously described the ruling as an overwhelming victory for Manila, a heavy defeat for Beijing, and a game changer for Asian maritime disputes. But so far, the award hasn’t changed the underlying dynamics of regional politics in the South China Sea, and ASEAN, a powerful southeast Asian body, refrained from commenting on the award following a meeting, a move widely seen as the result of arm-twisting from Beijing. In fact, it is becoming clear that the tribunal’s finding was so sweeping that it is paradoxically less likely to have any real-world impact. Perhaps the biggest paradox of the ruling is that many policy elites inside China now privately see it as a big gift to their government. That, at least, was the immediate post-ruling reaction from several leading scholars at prestigious think tanks in Beijing, who wished not to be named. For those who have questioned Beijing’s refusal to take part in the arbitration and who would have liked to see meaningful engagement instead, the outcome came as a personal disappointment and a blow to their cause. But for those who have opposed the arbitration process, there is more than a sigh of relief at the fact that the nature of the award makes it far easier for Beijing to delegitimize it, at least at home. Three camps – realists, hardliners, and moderates – are currently vying for influence over South China Sea policy within China’s policy-making apparatus. The award is likely to make the hardliners a winner in these internal debates. They have long maintained that the arbitration case is but an American conspiracy against China; now the outcome serves as vindication of those suspicions. Beijing will now have no qualms about upgrading administrative and physical control to further strengthen its positions in the South China Sea – in recent days, China’s military has already swiftly moved to begin regular patrol of the South China Sea, in addition to conducting a new round of military exercises. China’s top naval commander has affirmed Beijing’s determination to complete island construction, likely including military installations. The sweeping nature of the award has invited Chinese analysts and officials to try to tear it apart. Immediately after the ruling, one vice foreign minister criticized the fact that the judges were paid by the Philippines for their work. He said that the tribunal does not understand Asian culture or the South China Sea dispute, given that four of the judges come from Europe, and one from Ghana. More recently, a team of scholars from the Chinese Communist Party’s Central Party School concluded the tribunal had misunderstood China’s claims to the “nine-dash line.” On the diplomatic front, the tribunal decision presents more of an obstacle than an opportunity for Manila and Beijing to reach a compromise, at least in the short run. After the award, Chinese diplomats insisted it cannot be used as the basis for negotiation under any circumstances, deadlocking negotiation while China continues to build up its physical presence in the South China Sea. Yet in the months leading up to the award, Chinese diplomats heard calls from many countries for China to comply with the outcome of the arbitration. The pressure was mounting. The more limited the outcome, the easier other countries would have found it to call for Chinese compliance, and the more combative Chinese resistance would have appeared. That pressure has now abated; one senior Chinese diplomat privately described the award as “stupid.” Although China expected the ruling to favor the Philippines, this diplomat said, the findings still came as a surprise. Chinese officials hope that the broad nature of the award helps to convince other countries that the tribunal is biased. They will no doubt find solace in the fact that thus far, only the Philippines, the United States, Australia, New Zealand, Canada, Japan, and Vietnam have openly called for Chinese compliance. This list surprises no one, since the Philippines initiated the arbitration, the United States is presumed to have instigated it, Australia, New Zealand, Canada, and Japan are key U.S. allies, and the final country, Vietnam, is itself involved in territorial disputes with China while also emerging as a security partner for the United States. ASEAN’s joint communiqué, issued almost two weeks after the ruling, mentions neither China nor the arbitration, although it expresses serious concerns over recent developments including land reclamations. The European Union, along with many other countries, have used mild language merely to acknowledge the ruling, without calling for compliance. Another paradoxical effect of the award is its potential to effect Chinese attitudes toward international law. Beijing’s refusal to take part in the arbitration process has always confused Chinese scholars, particularly legal experts. (An article by an overseas Chinese scholar criticizing Beijing’s refusal to participate as damaging to China’s national interests aroused huge controversy at home.) The award, however, undermines advocates of a more proactive approach to international law by appearing to demonstrate the political nature of the arbitration process. The “anti-participation” camp is now arguing more forcefully that advocates of participation are naïve and utopian in placing hope in international law. Had the award been more attentive to Chinese interests, a future, more enlightened leadership in Beijing might have gradually and quietly complied with some of the rulings (whatever its public statements to the contrary), thus bringing China’s claims broadly in line with the United Nations Convention on the Law of the Sea. But this award doesn’t appear to give Chinese leaders such face-saving opportunities. One can argue that, over the long run, the award brings benefits to China. For example, the United States and Japan currently claim some of their features in the Pacific Ocean as “islands” entitled to EEZs. But under the award’s narrow definition of “islands,” the status of these features would be reduced from “island” to “rock,” and thus no longer entitled to exclusive economic rights. Unfortunately, to think in more creative and forward-looking terms will require a radical change of mindset among the Chinese leadership that is all but inconceivable for the foreseeable future. For a long time to come, China will be instead preoccupied with preventing and reversing losses to its interests in the South China Sea that it believes have accumulated over the past several decades as a result of Southeast Asian claimant states’ actions, rather than with making new economic or strategic gains in the high seas. Of course, the tribunal likely based its judgments on legal grounds, not prudential considerations about the award’s possible geopolitical implications. But from Beijing’s perspective, what at first glance looks like a home run for the Philippines actually represents the best outcome from a bad case. In this sense, the Philippines has won too much. The many paradoxes the award presents are not all bad for regional politics. Beijing has moved proactively to prevent large-scale demonstrations against the ruling, inviting some confidence in its basic policy rationality. The ruling also makes it less likely for Southeast Asian countries to initiate new arbitrations, since the award’s reasoning also applies to and favours their EEZ claims. In addition, the United States will have less incentive to conduct its Freedom of Navigation operations in such a public manner, since the ruling makes much of the South China Sea international waters as far as American naval vessels are concerned. Moving forward, American restraint will reduce the likelihood of maritime incidents with China and create conditions for more effective diplomacy. It will be needed, given the uncharted territory awaiting Asia’s troubled maritime order in a post-arbitration world.” http://foreignpolicy.com/2016/07/28/can-china-actually-be-benefiting-from-south-china-sea-ruling-paradox-hague-philippines/

Who Supports China In The South China Sea And Why. Wang Wen and Chen Xiaochen, The Diplomat. “The South China Sea arbitration case has elicited almost unanimous public opposition in China. Besides this, it has been reported that 66 countries worldwide have endorsed China’s position on the South China Sea. Yet that figure also caused controversy, especially in the United States. According to our team’s research, we have found at least 70 countries supporting China’s position on various occasions. We find that the reason for the controversy over the figure comes down to different definitions on “China’s position.” But no matter how it is defined, the psychology behind these statements is a desire to avoid taking sides between China and the United States, showing the reality of a fundamental global consensus on peace and wide-spread anxiety toward the potential for conflict in the South China Sea. Thus, we should take every opportunity to go beyond the “zero-sum game” in order to maintain peace in the South China Sea, to seek Asia-Pacific economic cooperation, and to make the “cake” bigger using economic and financial means. There is no doubt that Chinese almost unanimously support their government’s official position on the South China Sea, shown by the firestorm of social media comments soon after the award. Moreover, China’s position is also welcomed and understood by other countries. According to the Chinese government and media, nearly 100 parties from more than 60 countries declared their support for China’s position on the South China Sea issue. China Daily counted 66 countries, as shown in the map below. The figure, however, encountered doubts from American media and think tanks. The Asia Maritime Transparency Initiative argued that the real number was only ten. We personally also received emails expressing similar doubts. Considering such a huge gap in the count, our research team at the international studies department of Chongyang Institute for Financial Studies, Renmin University of China (RDCY), sought to verify on our own by conducting an independent count. We explored the issue by extensively searching the internet, and then looked for original sources including media reports, official statements, diplomatic documents, and talking points. We also searched the Chinese foreign affairs database, Xinhua‘s news and multimedia database, and our news citation system with data from various sources such as Bloomberg and Reuters to verify. Strikingly, we identified 70 countries that have expressed their support for China’s position, even more than reported by Chinese media. In addition, the League of Arab States and Shanghai Cooperation Organization are also in line with China. (We have listed the countries and sourced all of the statements, with the date of issue, in the appendix below). It is said some others privately expressed support to China according to our global network, but we only counted the countries that went on record. It is also possible that our team may have miss some countries that are supporting China. One reason is quite obvious: some of these statements of support are not available in English. They are expressed and available in Chinese, French, Spanish, Arabic, Swahili, Khmer, or other languages. Therefore, some analysts in the English-speaking world may have merely failed to find them. More importantly, though, the discrepancy has something to do with the essence of “China’s position.” Simply put, we suppose most American media and think tanks have not yet understood what “China’s position” means. In our view, China’s position on the South China Sea issue can be interpreted as below: China does not participate in the arbitration, nor accept, recognize, or implement the award. China will adhere to peaceful negotiations and settlements of the South China Sea dispute. While disputes should be settled by the parties directly concerned in accordance with the Declaration on the Conduct of Parties in the South China Sea (DOC), China will work with ASEAN countries to maintain peace and stability in this region. The temporally-established (ad hoc) arbitral tribunal is neither a part of the Permanent Court of Arbitration (PCA) nor the International Court of Justice (ICJ). It does not have jurisdiction over the territorial disputes, which is the core of the arbitration. The arbitration itself is flawed in procedure. Thus, the award is not legally-binding, nor representing international law. To directly support any of those components is to support China’s position. On the contrary, those countries that openly endorse the arbitral tribunal as affiliated to PCA and assert China should recognize and implement the award oppose China’s position. In this regard, at least 70 countries, based on our research, endorse China’s position in various angles of the four components above, and they did so in various ways: unilaterally, bilaterally, or multilaterally. All of them welcome peaceful negotiations to settle the disputes. In addition, we should bear in mind that Philippines’ ex-parte arbitration violates its own commitment to peaceful dialogue and negotiation. Among these countries, some expressed their public and firm support for China’s stance of non-acceptance of the arbitration. Nonetheless, “non-acceptance” is only part of China’s position. American media and think tanks who use this alone for their counts misinterpreted the implication of China’s position. Generally speaking, most countries’ attitudes toward the South China Sea issue can fall into three categories. Counties in the first category, represented by Japan, oppose China’s position by supporting the Philippines’ stance while insisting China should recognize and implement the result of the arbitration, which is claimed to officially represent the PCA. This opinion is rare. China Daily mapped five in its report, but our team can only identify three: Japan, Australia, and the United States. Vietnam and the United Kingdom, though represented on the map, do not meet the definition of opposing China directly. In this circumstance, although Japan indeed raised the issue at the Asia-Europe Meeting (ASEM) in Ulaanbaatar, it was echoed by no country except the Philippines itself, according to Japanese media such as Japan Today, The Japan Times, and The Japan News. The second group includes countries that explicitly expressed their firm support to China on the arbitration, such as Pakistan, Cambodia, and some African countries. This group is bigger than the first one, but still limited. For example, in a public speech broadcast on TVK, Cambodia’s state-owned television network, on June 20, Prime Minister Hun Sen revealed diplomatic pressure over the South China Sea from “certain country outside the region” — widely believed to refer to Japan — and expressed his objection to the arbitration. In a press release found on the official website of the Ministry of Foreign Affairs of Pakistan on July 12, the Chinese neighbor reiterated its support for China on its statement of optional exception in light of Article 298 of the United Nations Convention on the Law of the Sea (UNCLOS). Among African countries, Kenya issued a statement on June 15, also on its MFA website, declaring its respect for China’s right of optional exception under UNCLOS Article 298. Gambia, another coastal country in West Africa, has stated its support of China’s position on the arbitration by clearly saying the arbitral tribunal has no jurisdiction over delimitation in the South China Sea through the Gambia Radio and Television Service (GRTS). Last, many countries, categorized as the third group, support China’s position in terms of resolving the disputes through consultations and negotiations while following the Declarations on the Conduct of Parties in South China Sea (DOC). Combining the second and the third groups, we have found 70 countries, with probably some still missing. Our global think tank network and foreign embassies in Beijing told us some other countries also hold similar attitudes, but have not openly expressed their position due to some “pressure.” We did not include them in our count. Therefore, our key finding is that the claim by Chinese officials that at least 66 countries support China’s position is verified and solid; in fact, we found five more countries. Although the second and third groups as outlined above may have different stresses on China’s position, they all welcome at least one of the four components. Considering China’s official position on the peace negotiations, these two types of opinions acknowledge the path of peace talks. Further, the fact that most countries do not show a hardline stance toward either China or the United States illustrates their anxiety about conflicts. This psychological factor is the fundamental issue behind the rally of support. In our opinion, the moderated stances of most countries can be explained by the global fundamental consensus over the South China Sea issue — a desire for peace. However, some people are worried about the possibility of an armed clash in the South China Sea and even the start of a “new Cold War” which may force countries to take sides between the United States and China. From this point of view, those who assert that only 10 countries support China not only too narrowly define “China’s position,” but also fail to fully recognize the nuance of other countries’ positions. Moreover, whether the count is 10 or 70, the real issues behind these statements are the global consensus on peace and worldwide anxieties or even fears of conflict — or worse, war. In recent years, conflicts and turbulence have risen across the world. Thus, there are great anxieties about social unrest and mass violence; there are also anxieties about the distrust between major powers, which may very likely result in a new Cold War or even hot wars if badly managed. East Asia has long been called “The Museum of Cold War,” where long-standing geopolitical and traditional security issues have not yet been settled and even have been heating up in recent years, especially after the “pivot to Asia” was introduced. Recently, the South China Sea has been the focal point of Sino-U.S. relations. However, when it comes to the South China Sea issue, some countries find themselves trapped into a dilemma: not only do they worry about the loss of economic support from China, but also they are worried about the loss of security support from the United States. Moreover, some may worry that the regional organization they belong to will be split by the South China Sea issue. Besides Cambodia mentioned above, Singapore and Thailand have also stated that they will not be involved in the disputes and called for peace. Further, ASEAN as a whole did not form a unanimous view after the arbitration, which shows even ASEAN countries try to avoid taking sides between the two giants. A great portion of China’s support comes from African and Middle Eastern states that call for diplomatic negotiations rather than unilateral actions. This is not surprising given their collective history as colonies and the deteriorating security environment in these regions. Extremism is on the rise while the South China Sea heats up. In one of our seminars in Washington D.C. recently, Professor Amitai Etzioni of George Washington University reminded us that the United States’ active response to terrorism and extremism in the Middle East and Africa will also guarantee its credibility among allies without taking on the risk of conflict with China; meanwhile, China has many common interests with the United States on anti-terrorism issues. Take a look at the tragedy in Nice, think about the death toll in Kabul, let alone the long-lasting bloody turbulence in the Middle East, then you will probably agree with our conclusion: it is time for China and the United States to work together to address our common threats — terrorism and extremism — instead of focusing on the current zero-sum game in the South China Sea. When former Chinese State Councilor Dai Bingguo famously said the arbitral award is nothing but “a piece of waste paper” in the U.S.-China Dialogue on the South China Sea held by our institute (RDCY) and the Carnegie Endowment for International Peace, we have almost forgotten his key point is that we need a cooling down. Indeed, no matter how the public reacts to the arbitration, the “fusing point” — July 12 – has already passed; all parties are evaluating the next step in the game and restarting the long-term setup for the region. As we mentioned above, peace, the real and fundamental global consensus, remains there. Whether parties want it or not, the disputes will be settled in peace while regional cooperation will continue. In fact, even in the Philippines there is an effort toward peace. Rodrigo Duterte, the new president, has shown a low-key, restrained, and cooperative attitude after the arbitration. It is reported that Fidel Ramos, a former Philippine president (and also the authors’ friend), will visit China as an envoy. All these efforts show that peace and stability remain the common interests of all parties of the South China Sea in the “post-arbitration” era. This also goes for the United States. As Jeffery Bader of the Brookings Institution wrote in his recent “framework for U.S. policy toward China,” despite the disputes over the South China Sea issue, China is still a vital stakeholder in global governance and shares a lot of common interests with the United States. In particular, China is going to hold the G20 summit in Hangzhou — a chance for China to lead the global economy recovery cooperatively with other G20 members, including the United States. So why can’t the two cooperate on the South China Sea? There have been good signs, in fact. Admiral John Richardson, the U.S. chief of naval operations (CNO) paid a successful visit to China on July 17-20, having a fruitful talk with his counterpart Adm. Wu Shengli. We hope this visit will serve as a new starting point for Sino-U.S. military exchanges after the arbitration. Furthermore, cooperative governance is plausible in the South China Sea. As the authors said at the U.S.-China Dialogue, the most devastating threat to the fishermen in and around the South China Sea is not from China, nor from the United States, but from typhoons. In this regard, all parties, including China and the United States, can cooperate on issues such as meteorological stations, data sharing, typhoon early warning systems, and joint research on climate change. When it comes to hard military issues, the mechanism for Sino-U.S. cooperation already exists. China has taken part in the RIMPAC exercises twice now; in fact, as we wrote this piece, one Chinese fleet was exercising together with U.S. Navy around Hawaii. It is time to freeze tensions as well as activating the existing military exchanges. We should also bring joint development and broader economic cooperation back to table. Recently, the Duterte government has expressed its will to cooperate with China in exploiting the resources of the South China Sea. The Philippines have some maritime area in the South China Sea that are not subject to sovereignty disputes, but does not have the technology and investment to benefit from them. Here China can do something for the Philippines. This prospect recalls the suggestion to shelve differences and seek joint development put forward by former Chinese leader Deng Xiaoping when meeting with a former Philippine leader. Finally, as we wrote in our previous article, the South China Sea issue will not stop China-ASEAN economic and financial cooperation. The 21st Century Maritime Silk Road initiative and Mekong-Lancang Mechanism initiated by China are shaping more diversified development projects, and a more flexible and open win-win situation where all ASEAN countries can obtain the investments that they urgently need, including in the sectors of manufacturing, infrastructure, and what we call the “financial infrastructure.” Moreover, the Asian Infrastructure Investment Bank (AIIB) is a financial institution with strong compatibility and feasibility. The Philippines joined the institution as a founding member; of course, Japan and the United States are welcome to join and benefit from AIIB as well. To conclude, to avoid a war and to maintain peace in the South China Sea and the Asia-Pacific is the real and fundamental global consensus behind the divergent views on “China’s position.” To make a difference, China, the United States, and other countries should bring joint development back and focus more on possible cooperation areas from anti-terrorism to economic and financial ties, eventually leading the global economy out of its sluggish and uneven recovery.” http://thediplomat.com/2016/07/who-supports-china-in-the-south-china-sea-and-why/

The South China Sea Ruling: Reinforcing China's Negative Image In Japan. Santosh Sharma Poudel, The Diplomat. “On July 12, 2016, an arbitral tribunal appointed by the Permanent Court of Arbitration under the United Nations Convention of the Sea (UNCLOS) issued a ruling that “concluded that there was no legal basis for China to claim historic rights to resources within the sea areas falling within the ‘nine-dash line’” in the South China Sea, among other points. The ruling is legally binding. Yet China insisted from the start that the tribunal does not have jurisdiction over the issue. Beijing and Manila had agreed to settle their relevant disputes through negotiations; thus, China argued, Manila’s decision to unilaterally initiate arbitration was against its obligations. China would neither participate in the tribunal nor accept the ruling. Unsurprisingly, China declared that the tribunal’s award was “null and void.” However, the tribunal’s decision and Chinese reaction have implications beyond the South China Sea. While this arbitration was between the Republic of the Philippines and the People’s Republic of China, it has significant implications for Japan. Japan’s interest in the South China Sea is multi-dimensional. About $5.3 trillion in trade is conducted through South China Sea per annum, globally. Japan being a trading and resource dependent country, freedom of navigation along the sea lanes is extremely crucial for Japanese economy and security. However, another direct implication of the ruling is over the rule of international law, which is an important feature of Japanese foreign policy. Immediately after the ruling by the tribunal, Japanese Foreign Minister Fumio Kishida released a statement advocating “the importance of rule of law” and reminding that the ruling is “legally binding” and “hence the parties [read China] are required to comply.” Another important factor is the effect on Japan’s image of China as a result of Chinese (non)compliance. To start with, the lack of mutual trust between China and Japan is vast, but not new. Japanese have increasingly come to view China as “assertive” at best and a “bully” at worst, which has a contemptuous disregard for international rules and norms when those rules or norms do not favor PRC. This, to Japan, shows Chinese willingness to use the rules in their favor, and discredit them otherwise. This ruling and subsequent Chinese non-compliance provides fodder, if it was lacking earlier. China has signed and ratified UNCLOS. However, as the tribunal’s decision went against Chinese interests, China conveniently decided to discredit and reject the ruling. In fairness, China was consistent from the beginning that the tribunal’s decision will be “null and void.” This shows, at best, China cherry picking which part of international rules they have ratified will apply to them – and at worst gross disregard for international rules. This only solidifies the Japanese view that China “uses” international rules only when those rules serve Chinese interests. This has serious implication over the Senkaku (what China refers to as Diaoyu or Diaoyudao) Islands. According to analysts in Japan, Japan seems ready to battle the case in the International Court of Justice (ICJ) if China were to bring the issue there. Yet the Chinese reaction to the tribunal’s ruling in the South China Sea breeds no confidence that China would accept the ruling if it goes against China even if it were to bring the issue to ICJ, which itself is very unlikely. Thus, this effectively rules out any possible solution to the Senkaku issue vis-à-vis ICJ. As the ruling date neared, Beijing also raised objections over the selection of three of the five judges to the tribunal by then-president of the International Tribunal for the Law of the Sea (ITLOS), Shunji Yanai, who is of Japanese nationality. China suggested that Yanai’s role amounted to “bias.” Additionally, China argued that the four judges of European origin would not sufficiently understand the history of South China Sea. This can be understood as the reaction of a state which is seeking reasons to discredit a result it was determined to reject. Yet Beijing’s willingness to use any “Japan factor” in order to discredit the tribunal’s ruling shows that the trust deficit runs very deep. Some analysts have framed China’s non-compliance as a typical reaction of a “great power.” According to realists, great powers are not necessarily bound by international rules when their interest is at stake. If this is true, it is more alarming to the global community, including Japan, as to what kind of “great power” China will turn out to be. This is especially true for Japan, which is in China’s direct neighborhood and has some outstanding issues with Beijing, including the territorial dispute over the Senkakus (a dispute that Japan denies exists) and the “history” issue, among others. Already, China is being labelled as “assertive” or a “bully”; its non-compliance will only serve to reinforce that image. This has resulted in further strategic distrust between the two governments and a growing number of Japanese who view China unfavorably. According to an opinion poll by Genro in October 2015, nearly nine out of ten Japanese citizens view China unfavorably. Chinese non-compliance to international rules and norms is one of the major factors that contribute to this negative image. China’s response and actions in the days after the ruling will either mitigate or fuel these concerns. In the aftermath of the tribunal’s ruling, China has conducted military exercises closing off some parts of South China Sea. Additionally, the Southern Theater Command of the People’s Liberation Army (PLA), which looks after the South China Sea front, unveiled a series of new weapons for sea and air combat. Other reports that China is preparing to declare an Air Defense Identification Zone (ADIZ) over the South China Sea do not bring much confidence that China will look to mitigate the political and diplomatic cost incurred by the tribunal’s ruling. Instead, China seems ready to offset the cost by bolstering its force and presence in the region. On the day of the ruling, China deliberately “leaked” a photograph of China’s most advanced nuclear-powered submarine, an implicit warning. In the words of Beijing-based military commentator Song Zhongping, “no matter what the international arbitration ruling said, China will keep pushing ahead with its maritime ambitions in the South China Sea because it regards it as a ‘fortress’ ... and the only route for China to establish itself as real maritime power.” This will further give credence to the image of China as a “bully” or “assertive” nation. Chinese “non-acceptance, non-participation, non-recognition and non-compliance“ stance toward the tribunal and rejection of its ruling has only served to reinforce the existing negative image of China in Japan and beyond. It definitely will have only a negative effect on China’s soft power, including its aim to be known as responsible, law-abiding state. This is not to suggest that Japan’s image of China is a result of China activities in South China Sea alone. Sino-Japanese relations are too multi-faceted to be defined by a single issue. However, an instance like this provides a glimpse of how the two countries view one another. Also, the South China Sea ruling and Chinese response are not made in a vacuum. Japan feels the anxiety brought about by the rapid rise of China and the opaqueness of its rapidly modernizing military force. With Japan having a stake in the rule-based order in the region and facing a territorial dispute with China, Chinese activities in South China Sea are very keenly watched by Japan. Chinese activities in South China Sea serve as a potential precedent for Chinese activities in East China Sea.” http://thediplomat.com/2016/07/the-south-china-sea-ruling-reinforcing-chinas-negative-image-in-japan/

China Claims J-20 Fighter Will Be Combat Ready In 2019. George Allison, UK Defence Journal. “Two LRIP aircraft have already rolled off the line; the first began flight testing in January. The Chinese People’s Republic Army Air Force is believed to have received four J-20 jets, which have completed acceptance tests recently. It is understood that the first front-line units are supposed to activate and receive aircraft this month and are expected to be combat ready by 2019. In April 2009, a Wall Street Journal report indicated that, according to the Pentagon, information from the Lockheed Martin F-35 Lightning II had been compromised by unknown attackers that appeared to originate from China. There is some speculation that the compromise of the F-35 program may have helped in the development of the J-20. United States Secretary of Defense Robert Gates downplayed the significance of the aircraft by questioning how stealthy the J-20 may be, but stated the J-20 would “put some of our capabilities at risk, and we have to pay attention to them, we have to respond appropriately with our own programs.” The main weapon bay is capable of housing both short and long-range air-to-air missiles. Two smaller lateral weapon bays behind the air inlets are intended for short-range missiles.” https://ukdefencejournal.org.uk/china-claims-j-20-fighter-will-combat-ready-2019/?utm_source=TW&utm_medium=Twitter&utm_campaign=social

Fatal Crash Of Chinese J-15 Carrier Jet Puts Question Mark Over Troubled Programme. Choi Chi-yuk, South China Morning Post. “Mainland state media confirmed for the first time yesterday that a home-grown, carrier-based J-15 jet fighter crashed during training in April. The crash could deal a blow to the development of the fighter jet and cast a shadow over the PLA Navy’s blue sea strategy and aircraft carrier programme. J-15s are the core jet fighters for the mainland’s aircraft carrier, the Liaoning, and other more advanced domestic carriers reportedly under construction. China National Radio reported yesterday that a top-class PLA J-15 pilot died after he lost control of his plane during a simulated deck landing exercise at a unspecified inland base. “When Zhang Chao was flying a carrier-based jet fighter in a mock landing on an aircraft carrier on April 27, he encountered a breakdown with the fly-by-wire flight control system,” the report said. “At the critical moment, Zhang tried his best to save the aircraft. When the pushrods failed, he ejected and died as a result of an injury on landing.” Macau-based military expert Antony Wong Dong warned that the fatal accident might indicate that the J-15 was not of high enough standard for an aircraft carrier, which would be a major disappointment to the navy. “As was with case with accidents during trial flights of the Su-27s in the 1980s, the reason behind the crash of the J-15 could either be a failure in the flight control system or a problem with production quality,” Wong said. Canada-based Kanwa Defence Review reported in January that the programme for the development of the J-15 was well behind the demands of the navy, with the aircraft’s maker, Shenyang Aircraft Corporation, managing to deliver no more than 10 of the planes between 2012 and 2015. Some military observer suggested that the People’s Liberation Army might reconsider its commitment to the J-15, but Wong said he thought the reverse might be the case. “As there is no alternative in sight, I think the Chinese military will not abandon its plan but be forced to go on building J-15s,” Wong said. The state radio report said Zhang, a 29-year-old Hunan native, had just been promoted as a full battalion ranking lieutenant commander this month. The defence ministry said late last year that it was building its second aircraft carrier, the first to be made in China.It would adopt the same ski-jump take-off design that analysts said would suit J-15 jets. Analysts had expected the carrier to be ready for use by 2020.” http://www.scmp.com/news/china/diplomacy-defence/article/1995729/fatal-crash-chinese-j-15-carrier-jet-puts-question-mark

China Says To Hold Drills With Russia In South China Sea. Ben Blanchard, Reuters. “China and Russia will hold "routine" naval exercises in the South China Sea in September, China's Defence Ministry said on Thursday, adding that the drills were aimed at strengthening their cooperation and were not aimed at any other country. The exercises come at a time of heightened tension in the contested waters after an arbitration court in the Hague ruled this month that China did not have historic rights to the South China Sea and criticized its environmental destruction there. China rejected the ruling and refused to participate in the case. "This is a routine exercise between the two armed forces, aimed at strengthening the developing China-Russia strategic cooperative partnership," China's defense ministry spokesman Yang Yujun told a regular monthly news conference. "The exercise is not directed against third parties." China and Russia are veto-wielding members of the U.N. Security Council, and have held similar views on many major issues such as the crisis in Syria, putting them at odds with the United States and Western Europe. Last year, they held joint military drills in the Sea of Japan and the Mediterranean. China claims most of the South China Sea, through which more than $5 trillion of trade moves annually. Brunei, Malaysia, the Philippines, Taiwan and Vietnam have rival claims. China has repeatedly blamed the United States for stoking tension in the region through its military patrols, and of taking sides in the dispute. The United States has sought to assert its right to freedom of navigation in the South China Sea with its patrols and denies taking sides in the territorial disputes. Russia has been a strong backer of China's stance on the arbitration case, that was brought by the Philippines. Yang said China and Russia were comprehensive strategic partners and had already held many exercises this year. "These drills deepen mutual trust and expand cooperation, raise the ability to jointly deal with security threats, and benefit the maintenance of regional and global peace and stability," he said.” http://www.reuters.com/article/us-southchinasea-china-drills-idUSKCN1080O8

Japanese Sub Visits Ex-US Navy Base In Philippines, Despite China’s Warnings. Southfront. “A Japanese submarine has visited a former US naval base located on the edge of China’s territorial claim. On July 24, Tokyo was warned by Beijing against meddling in the South China Sea conflict, where the Hague Tribunal had recently ruled against China’s nine-dash line territorial claims. “Japan is not a party to the South China Sea issue, and considering its shameful history, it has no rights whatsoever to accuse China on the matter,” the Xinhua news agency quoted the words of Chinese Foreign Ministry spokesperson Lu Kang. However, this did not prevent one of the newest and largest Japanese submarine to visit a former US naval base in Subic Bay, in the Philippines, being escorted by two Japanese destroyers. The incident took place one day before the annual Balikatan military exercise, in which the Philippines, the United States, Australia, and Japan are going to take part over the next 12 days. Tokyo states that the submarine’s arrival in the South China Sea is not aimed at any country. Beijing has not yet commented the incident. “We don’t have any message to any country,” the China Daily information website quoted the words of the Captain of Japan’s Maritime Defense Force, Hiraoki Yoshino. The US and its Pacific allies oppose China’s construction of artificial islands in the Spratly and Paracel archipelagos, and accuse the country of attempting to establish an air defense zone. China says that its islands will be used primarily for civilian purposes, and the country has every right to build within its own territory. Nevertheless, the US has pushed regional allies to play a more active role in countering China’s growth. Balikatan of the last year was similarly seen as a way to provoke Beijing.” https://southfront.org/japanese-sub-visits-ex-us-navy-base-in-philippines-despite-chinas-warnings/

U.S. Navy’s LCAC Docks In Australian Navy’s HMAS Canberra. Naval Technology. “The Royal Australian Navy’s (RAN) Canberra-class landing helicopter dock ship HMAS Canberra (L02) has successfully received the U.S. Navy’s landing craft, air cushion (LCAC) within its internal well dock for the first time. The operation was conducted as a part of the ongoing Exercise Rim of the Pacific (RIMPAC) exercise being held off the coast of Hawaii. The event was followed by successfully recovery-and-launch of four U.S. Marine Corps’s (USMC) amphibious assault vehicles (AAV). HMAS Canberra boat group commander lieutenant Sandy Jardine said that the recovery further marks the first step in conducting collaborative operations with U.S. amphibious assets in future. Jardine said: “The AAV will bring protected mobility across the water for our soldiers, while the LCAC gives us over the horizon reach at more than 40k.” The LCAC was guided into HMAS Canberra by RAN petty officer Bosun Michael Hammond. Jardine added: “For LCAC recovery, we needed to ensure the well dock stayed dry and at the correct angle. “We achieved that by adjusting the trim of the ship, and bringing the ship up to a higher speed. “Americans and Australians have always had a good working relationship, and to be able to experience this on board HMAS Canberra has been a very rewarding experience.” http://www.naval-technology.com/news/newsus-navys-lcac-docks-in-australian-navys-hmas-canberra-4960907

China And Asean Reach Deal On Uninhabited South China Sea Islands. Catherine Wong, South China Morning Post. “China and Asean members agreed on Monday to avoid basing people on now-uninhabited islands and reefs in the disputed South China Sea, as the bloc made its first official joint statement on the waters since an international tribunal ruling this month. The Association of Southeast Asian Nations’ joint communique expressed serious concerns over land reclamation and “escalations of activities in the area”, but did not directly challenge China nor mention the ruling. China and Asean then released a separate joint statement on implementing the Declaration on the Conduct of Parties in the South China Sea. The statement said China and Asean agreed to refrain from “action of inhabiting on the presently uninhabited islands, reefs, shoals, cays, and other features and to handle their differences in a constructive manner”. It also underlined their pledge to respect freedom of navigation and to peacefully solve territorial disputes through negotiation in accordance with international laws, including the UN Convention on the Law of the Sea. The Asean statement came after days of deadlock among senior Asean diplomats at a series of meetings in Vientiane, during which China’s close ally Cambodia was blamed for opposing references to the South China Sea in the joint statement. An Asean diplomat said the statement was drafted with Asean’s common interest in mind, but “not the interest of certain countries”. In a meeting late yesterday with Asean foreign ministers, US Secretary of State John Kerry made no direct mention of the South China Sea tensions between China and its smaller neighbours. But he did praise Asean generally for speaking up for “a rules-based international system that protects the rights of all nations whether big or small”, the Associated Press reported. In a meeting with his Asean counterparts, Foreign Minister Wang Yi called for a new page to be turned after the ruling by the Permanent Court of Arbitration in The Hague. China, which refused to take part in the arbitration or implement the tribunal’s ruling, has insisted the disputes will not affect its relations with Asean. Wang said his meeting with Asean foreign ministers was mostly about cooperation. “Only one country mentioned the arbitration [on the South China Sea],” he said. China and Asean would continue to push for the implementation of the Declaration on the Conduct of Parties in the South China Sea. Discussions about a binding code of conduct would be finalised by the first half of next year, he said. Wang warned again against “interference from outside countries” and efforts to “divide relations between China and Asean”, a veiled reference to the United States and Japan. “This page has to be turned over … The hype has to cool down,” he said. A Chinese diplomat said Beijing had been pushing for cooperation with Asean to export excess production capacity to countries in the region. Jinan University Southeast Asian studies expert Zhang Ming¬liang said Asean struck a careful balance in its response to the South China Sea disputes. “Asean has been very cautious on the issue. It has to safeguard its interests while at the same time avoid angering China,” he said. Zhang said the bloc had learned to manage differences since the 2012 meetings in Cambodia, when Asean officials failed to issue a joint statement for the first time due to clashes over the South China Sea. He had doubts that China and Asean could agree on the code of conduct by the first half of 2017 due to the grave differences between China and Asean countries. “But the two sides can start their cooperation in less sensitive areas such as fisheries and joint maritime rescue efforts,” Zhang said.” http://www.scmp.com/news/china/diplomacy-defence/article/1994669/china-and-asean-reach-deal-uninhabited-south-china-sea

U.S. To Support Talks In South China Sea Dispute. Ben Otto, The Wall Street Journal. “The U.S. said it would support talks between China and the Philippines to resolve a territorial dispute in the South China Sea, as the two global powers tried to calm tensions heightened by a recent ruling over Beijing’s sweeping claims there. U.S. Secretary of State John Kerry on Tuesday said that he would encourage Philippine President Rodrigo Duterte to negotiate bilaterally with China when the two meet in Manila on Wednesday. “This could be a very important moment of shifting how this discussion is taking place,” Mr. Kerry said in the Laotian capital. He added that China’s foreign minister conveyed to him in a meeting the night before that China seeks to “move away from the public tensions and to turn the page.” No claimant in the South China Sea, Mr. Kerry said, “should take steps that wind up raising tensions.” The comments followed a gathering of the 10-member Association of Southeast Asian Nations and other nations with Asian interests which was dominated by divisions over China’s territorial claims and activities in the sea. In a case brought by the Philippines, an international arbitration tribunal ruled on July 12 against China’s claims to historic and economic rights over most of the sea, where four Southeast Asian nations—the Philippines, Vietnam, Malaysia and Brunei—assert claims that overlap with Beijing’s. Fears of militarization grew as China rejected that ruling and announced long-range bomber flights to distant islands and new naval drills. The U.S. said it would continue sailing and flying through the region. France suggested European navies should patrol the waters as well. This week’s developments suggest China and the U.S. are trying to ratchet down the tensions. Regional diplomats in Laos said China has dropped mention of its “nine-dash line” territorial demarcation of the South China Sea in recent statements. They said China has also called for action on a long-delayed “code of conduct” for the region. And that it agreed that nations shouldn’t inhabit “presently uninhabited” islands and reefs. With that, these people said, China could be signaling that would curb its practice of building up artificial islands in the disputed waters, complete with airstrips and other facilities. “Everyone is making room for things to calm down,” one senior Southeast Asian diplomat said. U.S. National Security Adviser Susan Rice, who is visiting China this week, urged officials in Beijing to use the recent arbitration tribunal ruling as an opportunity to initiate diplomatic efforts that can ease tensions in the South China Sea, a senior Obama administration official said. Still unclear is how talks would proceed between China and the Philippines. China last week said it would negotiate its claims with the Philippines without acknowledging the tribunal’s ruling. The Philippines rejected an offer to talk with Beijing on that basis. Mr. Kerry didn’t address the issue on Tuesday. “It’s very odd that China is asking the U.S. to support bilateral talks when Beijing has imposed an unacceptable precondition on Manila that it must disregard the [tribunal’s] ruling,” said Ian Storey, a Southeast Asia specialist at the ISEAS Yusof-Ishak Institute in Singapore. “There’s no way Washington would put pressure on the Philippines to hold talks with China on the basis of putting the ruling aside.” The U.S., Japan and Australia on Monday called on China and the Philippines to abide by the ruling, noting in a joint statement that the decision was “final and legally binding on both parties.” The statement added that “the ministers stressed that this is a crucial opportunity for the region to uphold the existing rules-based international order.” The three countries also urged all states to refrain from large-scale land reclamation, the construction of outposts and the use of those outposts for military purposes. Asean hasn't issued a statement on the ruling, concluding its own meetings in Laos with a joint communiqué that called for respecting legal process, which diplomats said was an allusion to abiding by the July 12 ruling. Diplomats said Vietnam and the Philippines, a close U.S. ally, had pushed to include mention of the ruling in the 31-page communiqué but were blocked by Cambodia, a Chinese ally. The Philippines said that Asean had supported what they said was Foreign Affairs Secretary Perfecto R. Yasay Jr.’s proposal “to enshrine the ‘rule of law’ as a fundamental principle of Asean.” A note about respecting international legal processes, including those of the U.N. Convention on the Law of the Sea that guided the tribunal’s decision, appeared on the first page of the joint communiqué. The territorial dispute presents Mr. Duterte with a major foreign policy challenge. Mr. Duterte said during his presidential campaign that he favored talks with China but he has faced public pressure since the ruling to take a strong line. Mr. Duterte has repeatedly said that military force isn’t an option and used his maiden state of the nation address to strongly affirm the ruling “as an important contribution to the continuing efforts to pursue the peaceful resolution and management of our dispute” with China.” http://www.wsj.com/articles/beijing-asks-u-s-to-back-china-philippine-talks-1469511072

Chinese RIMPAC Delegation Snubs Japanese Sailors. Sam LaGrone, USNI News. “The Chinese naval delegation to the Rim of the Pacific exercises barred at least some Japanese sailors from touring their ships and only reluctantly invited members of the Japanese Maritime Self Defense Force to a reception aboard a People’s Liberation Army Navy warship, USNI News has learned. Several sources told USNI News that during more than a week of in-port receptions aboard participating countries’ warships, the Chinese delegation skipped the July 2 Japanese reception. Additionally, the PLAN initially did not invite the JMDSF attendees to their reception until U.S. leadership made public comments about inclusion. U.S. Pacific Fleet Commander Adm. Scott Swift and 3rd Fleet commander Vice Adm. Nora Tyson stressed that a multitude of countries working together was key to RIMPAC’s success and both stressed inclusivity in their July 5 opening day speeches. “While these specific allegations were not addressed to leadership, both Adm. Swift and Vice Adm. Tyson have repeatedly reminded all participants that inclusivity is critical to the mission of RIMPAC,” Cmdr. Ryan Perry with U.S. 3rd Fleet told USNI News last week. Several Japanese sailors attempting to tour Chinese ships during the subsequent RIMPAC open house day were turned away at the PLAN quarterdecks, two sources familiar with the snub told USNI News. U.S. Navy officials did not comment on the incidents further. A Navy official told USNI News there have been no problems with the Chinese during the at-sea portion of exercise on Monday. Last week, the commander of the Littoral Combat Ship USS Coronado (LCS-4) told USNI News operating with the Chinese has been positive. “The level of partnership I’ve seen so far has actually exceeded my expectations, and I feel it’s been a mutually productive exercise. We’ve gotten to learn a little bit about how they operate and develop some of those useful insights that I’m sure will pay dividends once we get over to 7th Fleet,” Cmdr. Scott Larson said on July 21. Attendees of RIMPAC 2014 – the first to which China was invited – told USNI News there were no issues with access to Chinese ships during the reception or the open house days. As part of the biennial RIMPAC exercise, service members from more than 20 countries meet and mingle on one another’s ships during receptions and cultural exchanges, which are hosted prior to the start of at-sea operations. Pictures published from this year’s event show U.S. Pacific Command commander Adm. Harry Harris pounding rice flour with a mallet on the Korean guided missile destroyer Sejong the Great (DDG-991), a mariachi band playing on a Mexican Navy amphibious ship during the California portion of the exercise, and a collection of specially-made RIMPAC sake boxes as a party favor on the Japanese helicopter destroyer JS Hyuga (DDH-181). Several formal naval officers who participated in the receptions at past RIMPACs told USNI News that tensions between regional rivals – like Korea and Japan – are put aside during the social portion of the exercise. What sources described as China’s snub to the Japanese at RIMPAC is reflective of the Beijing’s larger diplomatic playbook. “The Chinese use these very blunt instruments that can get under the skin of others to exhibit unhappiness or dissatisfaction as how they’re being treated,” Michael Fuchs, former U.S. deputy assistant secretary of state for East Asian and Pacific affairs, told USNI News on Monday. “Japan has been a favorite target of the Chinese and has been for some time, but are by no means alone.” In military-to-military relations, China has had a history of altering plans at short notice based on Beijing’s political mood, Naval War College professor James Holmes told USNI News on Monday. In the case of the U.S., China has canceled military-to-military relations for periods over arms sales to Taiwan and has revoked long-planned U.S. carrier port visits to Hong Kong with no notice. “We’ve made the mistake of showing how much we covet military-to-military engagement, so they see canceling mil-mil engagement as a cudgel to beat us around the head when we annoy them,” Holmes said. In May, the Stennis Carrier Strike Group was turned away from Hong Kong shortly after Secretary of Defense Ash Carter made a highly publicized visit to USS John C. Stennis(CVN-74) while it was in the South China Sea. In 2013, the Chinese sent the guided missile destroyer Qingdao to Australia’s International Fleet Review for less than a weekend while other participants stayed several more days, Holmes wrote in The Diplomat. While docked in Sydney, the crew stayed on the ship and no tours were allowed. Holmes said despite the alleged in-port reactions by the Chinese, Beijing values their inclusion in the exercise. “I will say I’m surprised they haven’t pulled out of [U.S. military-to-military] contacts entirely considering how events in the South China Sea have unfolded recently,” Holmes said. “Best I can tell, RIMPAC has gone off okay. They seem to place a lot of stock in that.” RIMPAC 2016 runs until Aug. 4 and includes, “27 nations, 45 ships, five submarines, more than 200 aircraft and 25,000 personnel,” according to the Navy.” https://news.usni.org/2016/07/25/rimpac_china_japan_snub

Retired Chinese General Sentenced To Life In Prison For Corruption. Josh Chin, The Wall Street Journal. “A retired Chinese general became the highest-ranking military official to be convicted as part of President Xi Jinping’s antigraft drive when a military court sentenced him to life in prison Monday for corruption. State media said 74-year-old Guo Boxiong, who was one of the top two officials in China’s military before his retirement three years ago, was stripped of his rank and had all of his personal assets confiscated, the official Xinhua News Agency said in a short report. Gen. Guo was expelled from the Communist Party a year ago over bribe allegations, a precursor to his conviction and sentencing. In a separate interview transcript published on the Ministry of Defense website, Xinhua quoted an unnamed court representative as saying Gen. Guo was found guilty of abusing his position to help others win promotion and accepting “an immense amount“ of bribes, either directly or through intermediaries. It didn’t elaborate. “Guo Boxiong made a full confession to the accusations of corruption against him, expressing his guilt and regret,” Xinhua quoted the court representative as saying. The trial was held behind closed doors as it involved state secrets, the news agency said. Gen. Guo served as vice chairman of the powerful Central Military Commission under former President Hu Jintao from 2002 to 2012. His case is just one of a series of high-profile prosecutions of senior military figures under the umbrella of Mr. Xi’s long-running antigraft campaign. His fellow vice chairman, Gen. Xu Caihou, was accused of corruption in 2014 but died of bladder cancer before he could face trial. Dozens of serving and retired generals have been detained or convicted on corruption charges under Mr. Xi, who has undertaken an ambitious program to remake the People’s Liberation Army into a modern force more capable of projecting power abroad. The military has been increasingly called upon to defend China’s claims in disputed areas of the East China Sea and South China Sea. A commentary posted on an official military website when Gen. Guo was expelled from the party a year ago compared him to Lin Biao, an army chief who was accused of plotting a coup against Mao Zedong before he died in a plane crash in 1971. Gen. Guo’s son, Guo Zhenggang, who is also a general, was placed under investigation for corruption in March 2015. It hasn’t been possible to reach either Guo for comment.” http://www.wsj.com/articles/retired-chinese-general-sentenced-to-life-in-prison-for-corruption-1469451107

Japan Defense Head, U.S. Pacific Command Chief Agree On S. China Sea. Kyodo News. “Japanese Defense Minister Gen Nakatani and Adm. Harry Harris, commander of the U.S. Pacific Command, affirmed Monday the importance of respecting a recent international tribunal ruling dismissing China's territorial claims in much of the South China Sea during talks in Tokyo. Harris' four-day visit to Japan from Sunday comes after an international court based in The Hague ruled on a case brought by the Philippines, finding "no legal basis" for China's claims to historic and economic rights over most of the waters. There appeared to be a slight difference in tone over the South China Sea ruling in the official account of their talks, a Japanese official said, though he declined to elaborate. But Harris agreed with Nakatani's assertion that it is important for the parties to conduct themselves according to international law, the official said. Nakatani and Harris also affirmed the importance of involving China in international affairs, the official said. Harris praised Japan's Maritime Self-Defense Force's participation in the ongoing Rim of the Pacific, or RIMPAC, exercise set to run through to Aug. 4, according to the official. The drill also includes the United States and China among a host of other maritime nations, according to the official. The official said that Nakatani and Harris also agreed to work together with South Korea in addressing North Korea's development of ballistic missiles, and affirmed their commitment to ongoing Japan-U.S. defense cooperation in the East China Sea. Tokyo has expressed concern over Chinese naval vessels' recent sailing into and around Japanese territorial waters in the East China Sea, including into a contiguous zone surrounding the Senkaku Islands. Beijing claims the uninhabited islets and calls them Diaoyu. Nakatani told Harris the revision in April last year of the Japan-U.S. defense cooperation guidelines and security legislation enacted by the Diet later last year have helped create "an effective framework for a stronger Japan-U.S. alliance." The legislation effectively expanded the role of Japan's Self-Defense Forces, allowing them to come to the aid of allies. "In response to recent (circumstances) including North Korea's missile launches and China's activities in the East and South China seas, I feel it is ever more important for Japan and the United States to respond thoroughly through our alliance," Nakatani told Harris as their meeting began. According to the official, Nakatani and Harris also agreed to go forward on the relocation of the U.S. Marine Corps Air Station Futenma in Okinawa, and the recently resumed construction of helipads in a U.S. training area elsewhere in the island prefecture. Both issues have attracted fierce local criticism. Nakatani acknowledged Harris' visit Sunday to areas in Kumamoto Prefecture, southwestern Japan, hit hard by April's deadly earthquakes, expressing thanks for U.S. airlift support in recovery efforts. "It's just another indication that friends help friends, and points also to the strength of the Japan-U.S. alliance," Harris said. Harris said he and Adm. Katsutoshi Kawano, chief of the Japanese Defense Ministry's Joint Staff, will tackle areas of important mutual interest in talks on Monday and Tuesday. Before sitting down to their talks, the officials discussed the hit smartphone game "Pokemon Go," released in over 30 countries including the United States and Japan, which presents the risk of users trespassing into restricted areas in search of virtual creatures to capture. Harris said he had heard the area around the Defense Ministry was a Pokemon hotspot, and Nakatani responded that the premises are set up so the creatures do not enter. The ministry is entirely free of "PokeStops," where users congregate to catch rare Pokemon and receive in-game items.” https://english.kyodonews.jp/news/2016/07/422894.html

The Coral Casualty Of China’s Marine Rampage. Andrew Browne, The Wall Street Journal. “– Protected by their country’s navy, Chinese fishing boats devastated mile upon mile of pristine coral in Philippine waters, using their propellers as blades to hack out giant clams buried in the reefs. Other threatened species that fell prey to Chinese poaching on an industrial scale, with official connivance: turtles, sharks, eels and oysters. And all of this, according to the unanimous ruling of an international tribunal in The Hague, was just the prelude to an even greater catastrophe – China’s dredging of seven massive islands in the Spratlys chain on top of the already traumatized reef systems that form a critical link in the fragile ecology of the South China Sea. The headline-grabbing part of the verdict, which stretches to nearly 500 pages, is its categorical striking down of China’s historic claims over almost the entire South China Sea within a “nine-dash” line. Yet the section that describes China’s obliteration of reefs is by far the most damning. It is a portrait of destructive power, unconstrained by international law, public opinion in the region, or seafaring tradition. The judges came up with a detailed description, backed by reams of scientific evidence, of how coercive Chinese policies now imperil the livelihoods of some of the region’s most vulnerable communities who live on the edge of hunger – those that make a living from the sea. Even though Obama administration officials harp constantly on the Chinese threat to navigation and overflight, that danger is theoretical, for now at least. China hasn’t yet interfered with commercial shipping or aviation. If it did, China itself would be the most notable casualty since it is the world’s largest trader. Ecological devastation, on the other hand, is all too real. Some 270 million people inhabit coastal areas of Southeast Asia; millions depend directly on the sea, many through fishing. China isn’t the only country that has made life precarious for these groups. Marine stocks in the South China Sea are severely depleted as a result of overfishing, practices like dynamite and cyanide fishing, as well as coastal pollution. Likewise, damage to reefs, where the cycle of marine life in the oceans begins, has been under way for years. Here comes China with the world’s largest fishing fleet, rapidly expanding navy and growing territorial ambition, exacerbating a crisis that condemns fishing villages in littoral states like the Philippines to poverty. According to one scientific report published in 2013, coral cover on atolls and archipelagoes in disputed areas of the South China Sea – six governments, including China and the Philippines, contest ownership – has declined from around 60% to 20% within the past 10 to 15 years. The situation off China’s coast is even more dire: Coral abundance has declined by at least 80% over the past 30 years on its fringing reefs, the report says. The tribunal verdict cites research by John McManus, a marine biologist at the University of Miami, who says the propeller harvesting of giant clams “exceeded anything I had previously seen in four decades of investigating coral reef degradation.” It quotes Sebastian C.A. Ferse, a coral-reef ecologist at the Leibniz Center for Tropical Marine Ecology in Bremen, Germany, as saying the artificial islands have destroyed complex reef systems formed over millennia and they won’t recover for decades, perhaps centuries. It is possible, he warns, that the demolition could have a “cascading effect” across the South China Sea, which covers 1.4 million square miles. China outright dismisses evidence that it is presiding over the environmental rape of a stretch of water that it increasingly treats like its own private lake. “China cares about protecting the ecological environment of relevant islands, reefs and waters more than any other country, organization or people in the world,” a Foreign Ministry spokesman said in May. China has rejected the tribunal’s verdict. The commander of the People’s Liberation Army Navy vowed that China would press ahead with building artificial islands in the Spratlys. Construction “is reasonable, justified and lawful,” Wu Shengli said, according to the official Xinhua News Agency. If ever there was an issue for Southeast Asian countries to tackle, as a regional group, this is it. Yet over the weekend, a statement that followed a meeting of foreign ministers of the Association of Southeast Asian Nations managed to avoid reference to the tribunal’s ruling altogether. China is a signatory to the United Nations Convention on the Law of the Sea – whose rules on the preservation of marine life it has blatantly flouted, according to the tribunal – but insists on negotiations with neighbors one by one to settle issues in the South China Sea. With a multiparty solution off the table, what’s ahead for the coral reefs? China can double down on its defiant island-building, or quietly comply with the ruling of The Hague. To gauge where one of the world’s most important marine areas is headed, don’t listen to the bluster of China’s admirals, focus instead on what its fishing boats and dredgers are doing.” http://www.wsj.com/articles/the-coral-casualty-of-chinas-marine-rampage-1469508763

Fantasy Island. Steve Mollman, Quartz. “On July 14, Taiwan’s ex-president Ma Ying-jeou held up a bottle of water during a press conference to prove a key point – that 400-meter-wide Itu Aba, the largest feature in the contested Spratly archipelago, is clearly not a rock. The water, sourced from the feature Taiwan calls Taiping Dao, is proof that it is actually an island, he said. The difference is worth billions of dollars to Taiwan, and could affect nations from Japan to France. Ma was responding to an international tribunal’s July 12 ruling that Itu Aba is legally a “rock,” based on the United Nations Convention on the Law of the Sea (UNCLOS). In terms of maritime rights, that means Itu Aba generates a paltry 12-nautical-mile territorial sea around it. The far more valuable designation of “island” produces an exclusive economic zone (EEZ) of 200 nautical miles. That would have given Taiwan and its industries coveted rights to fish, oil, natural gas, and other resources. The classification, made by the Permanent Court of Arbitration in The Hague, is certainly a blow to Taiwanese pride and its potential GDP. But Taiwan is not alone. Many “islands” dotting the globe generate EEZs, and many of those are smaller than Itu Aba. Nations with such EEZs – among them the U.S., Japan, and France – will now find they are more vulnerable to legal challenges. The July 12 ruling “adds great clarity to the law of the sea,” said Peter Dutton, a U.S. Naval War College professor, in an interview with the U.S. National Committee on U.S.-China Relations on July 13. “There’s now a lot more certainty about what islands get resource zones and what don’t. This is an issue that I think all states are now going to have to pay careful attention to. This is not just about China or even about other countries in the South China Sea.” The Spratly archipelago, about the size of Tunisia, is a scattered collection of islets, banks, reefs, and shoals. Each of the features is claimed by one nation or another, among them Vietnam, the Philippines, and most notably by China, which claims not just the Spratlys but most of the South China Sea, and has been frightening neighbors with its militarization in the area. With its small size and lack of aggression, Taiwan isn’t frightening anyone, although because of a shared history with China it makes an equally sweeping claim to the sea. But it did have high hopes for Itu Aba. It put significant effort into making the islet more island-like, adding gardens, livestock, and buildings. It also put in a runway, which looks inordinately large on the backdrop of the islet. In March, Taiwan arranged a group trip to the islet so that journalists and others could see for themselves just how island-like the place is. The visitors, once they emerged from a four-and-a-half-hour flight from Taipei aboard a military transport plane, learned that Taiwan had spent more than a $100 million upgrading the runway and port at Itu Aba. They also learned Itu Aba has fresh water (otherwise nearly nonexistent in the Spratlys), is naturally formed, and supports livestock. By contrast, China is reportedly considering the use of floating nuclear reactors for water desalination to support the artificial islands it has built in the sea atop reefs. Here’s one reason Taiwan cares so much about the classification. An EEZ surrounding Itu Aba would have overlapped with the EEZ generated by the west coast of the Philippines’ Palawan Island, near which is Reed Bank, believed to hold significant reserves of oil and natural gas. To resolve the overlap Taipei and Manila would have likely worked out a maritime boundary, and Taiwan (assuming its sovereignty over Itu Aba held) would have solidified rights to some of the hydrocarbon riches. After the ruling, it’s clear that under international law only the Philippines has sole extraction rights to those riches. What’s still unclear is whether Taiwan and China will respect the ruling. So far they have both strongly rejected it. In the past Chinese forces have prevented the Philippines from exploring for oil at Reed Bank, which falls within China’s “nine-dash line.” That line, drawn on a map in the 1940s, is used by China (and Taiwan) to justify its claims to nearly the entire sea. But the tribunal invalidated that line, which is welcome news for not only the Philippines, but also for Vietnam, Malaysia, and Indonesia, which have also encountered China’s aggression in their EEZs because of it. The tribunal did not rule on who has sovereignty over any of the contested features in the sea, as that was outside its jurisdiction. What it did rule on, under UNCLOS, is what’s legally an island versus a rock, among other maritime distinctions. The convention states that “rocks which cannot sustain human habitation or economic life of their own shall have no exclusive economic zone or continental shelf.” That passage, the tribunal noted, was there for a reason: [It] serves to disable tiny features from unfairly and inequitably generating enormous entitlements to maritime space that would serve not to benefit the local population, but to award a windfall to the (potentially distant) State to have maintained a claim to such a feature. The tribunal studied the history of UNCLOS to find further clarity, and also observed: The purpose of the exclusive economic zone that emerges from the history of the Convention... was to extend the jurisdiction of States over the waters adjacent to their coasts and to preserve the resources of those waters for the benefit of the population of the coastal State. If any nation is the “coastal State” in relation to Itu Aba, it’s the Philippines. The city of Puerto Princesa on its Palawan Island lies less than 490 km away, compared to the southern part of Taiwan at more than 1,500 km to the north. Designating Itu Aba a “rock” will have ramifications far beyond the South China Sea, partly because it sets a precedent. The five judges who issued the ruling “really shape the future of the law,” said Dutton. “These are five of the world’s most learned international law-of-the-sea scholars. They understand the law, they understand how it was developed.” Three of the judges who worked on the case are also judges on the International Tribunal for the Law of the Sea (ITLOS), an intergovernmental organization established by UNCLOS to settle disputes arising out of the interpretation and application of the UN convention. Another has served ITLOS as president and judge and currently participates as an ad hoc judge. One EEZ that’s more legally vulnerable after the ruling surrounds Okinotorishima, an uninhabited atoll claimed by Japan in the Philippine Sea. That EEZ includes rare metals in the seabed and possibly oil and gas. China, South Korea, and Taiwan have argued that Okinotorishima is at most a rock. Much of Okinotorishima’s dry “land” consists of three concrete structures. Japan would probably now lose a case challenging the EEZ. Among U.S. territories, the EEZs generated by Johnson Atoll (south of Hawaii), Jarvis Island (in the south Pacific), and Palmyra Atoll and Kingman Reef (in the northern Pacific) are now thrown into question. For France, ones around Clipperton Island (near Mexico), the Crozet Islands (between Africa and Antarctica), and parts of French Polynesia have less legal validity. There are more examples, but none of them matters much to Taiwan. On July 20 a group of Taiwanese lawmakers, and separately a group of patriotic fishermen, traveled to Itu Aba to reassert their nation’s sovereignty, protest the ruling, and, probably, blow off some steam. But it didn’t change the ruling. And as for that bottle Ma held up at the news conference? It soon emerged that the water in it was not really from Itu Aba – yet another claim struck down. Gulp.” http://qz.com/737219/this-tiny-islet-in-the-south-china-sea-is-now-officially-a-rock-and-the-implications-are-global/